PREPARE STATEMENT OF CASH FLOWS USING DIRECT METHOD

Comparative Balance Sheets December 31, 2018 and 2017 ($ in millions) 2017 2018 Assets Cash 135 160 Petty cash Accounts receivable 12 15 35 47 Allowance for uncollectible accounts (6) 0 (8) 32 Investment in A Corp Investment in B Inc C 30 Investment in C Ltd 18 18 Fair value adjustment (2) 37 3 44 Inventory Prepaid insurance Supplies Bond receivable 12 18 27 70 70 Premium on receivable 6 Land 90 100 Building Less: Accumulated depreciation Equipment Less: Accumulated depreciation 200 230 (60) 90 (70) 120 (36) (45) 758 651 Total Assets Liabilities Accounts payable Salaries payable Interest payable Unearned revenue Note payable Loan payable S 45 39 5 4 20 38 200 180 45 Owner's Equity Common stock 80 71 Contributed capital in excess of par Retained earnings 203 175 128 179 (20) C Dividend S 651 Total Liabilities & Equity 758 C PINK COMPANY Income Statement For Year Ended December 31, 2018 ($ in millions) Revenues Sales revenue 410 Expenses Cost of qoods sold Bad debt expense 177 7 31 Insurance expense Supplies expense Depreciation expense Salaries expense Interest expense Utilities expenses Income from operations 46 26 39 11 40 377 33 Other income and expenses Bond interest revenue Gain on sale of land 7 6 Gain on sale of Investment A 8 Loss on sale of equipment Unrealized holding gain (8) 5 Total other income and expenses 18 51 Net income Additional information from the accounting records: a) Land that originally cost $18 was sold b) The building has a life of 20 years c) Equipment that originally cost $18 was sold d) New equipment was purchased using the proceeds from a loan for the entire purchase price CO CO un