(Preparing the statement of cash flows - indirect method)

E11-19A. (Learning Objective 3: Prepare the statement of cash flows-indirect method) The income statement and additional data of Barnaby Travel Products, Inc., follow: A1 Barnaby Travel Products, Inc. Income Statement Year Ended December 31, 2018 3 Service revenue S 236,000 00 244500 5 Expenses: 6 Cost of goods sold 7 Salary expense 8 Depreciation expense 9 Advertising expense 10 Interest expense 11 Income tax expense 12 13 96,000 60,000 28,000 4,700 2,800 14000 205,500 S 39,000 Net income Additional data: a. Acquisition of plant assets was $156,000. Of this amount, $104,000 was paid in cash and $52,000 was financed by signing a note payable. b. Proceeds from the sale of land totaled $39,000 c. Proceeds from the issuance of common stock totaled $31,000 d. Payment of a long-term note payable was $16,000 e. Payment of dividends was $8,000 f. From the balance sheets A1 December 31, 2018 2 3 Current assets: 4 Cash 2017 170,000 33,200 63,000 72,000 8,800 Accounts receivab 47,000 30,000 9,000 entory 7 Prepaid expenses 9 Current liabilities: 0Accounts payable crued liabilities 34,000 $19,000 90,000 35,000 12 Requirements 1. Prepare Barnaby's statement of cash flows for the year ended December 31, 2018, using the indirect method 2. Evaluate the company's cash flows for the year. In your evaluation, mention all three cat- egories of cash flows and give the rationale for your evaluation