Problem 14-19A (Algo) Using financial statements to prepare a statement of cash flows-indirect method LO 14-1, 14-3, 14-4 The comparative balance sheets and an income statement for Rooney Corporation follow: Balance Sheets As of December 31 Year 2 Assets Year 1 Cash $ 61,878 $ 40,110 Accounts receivable 33.327 24,440 Merchandise Inventory 156.092 171,700 Prepaid rent 2,395 4,790 Equipment 253,700 285,220 Accumulated depreciation (145.510) (231,460) Land 196,660 33,160 Total assets $ 558,542 $ 377,960 Tiabilities Accounts payable (inventory) $ 66,242 75,140 Salaries payable 26, 472 22.690 Stockholders' equity Common stock, 550 par value 249,000 199,000 Retained earnings 216.820 81,130 Total liabilities and equity $ 558,542 $ 377,960 Incon Statement For the Year Ended December 31, Yoar 2 Sales $1.501,000 Cost of goods sold 1797.732) Grons profit 703,268 Operating expenses Depreciation expense (23,270) Ront expondo 128,880) Balar les expense (258,160) 1257201 Income statement For the Year Ended December 01, Year 2 Salen $1,501,000 Cost of goods sold (397.732) Gross profit * 703,260 Operating expenses Depreciation expense (23,270) Rent expense (28,880) Salaries expense (258,160) Other operating expenses (257,260) Net income $ 135,698 Other Information 1. Purchased land for $113,500. 2. Purchased new equipment for $99,300. 3. Sold old equipment that cost $130.820 with accumulated depreciation of $109,220 for $21,600 cash, 4. Issued common stock for $50,000. Required Prepare the statement of cash flows for 2017 using the indirect method. (Amounts to be deducted and cash outflows should be indicated by a minus sign.) ROONEY CORPORATION Statement of Cash Flows For the Year Ended December 31, Year 2 ROONEY CORPORATION Statement of Cash Flow For the Year Ended December 31, Year 2 Cash flows from operating activities: Add: Decrease in current assets and increases in current liabilities: Less Increases in current assets and Decreases in current liabilities: Plus: Noncash charges Cash flows from investing activities in current assets and Decreases in current liabilities: Plus: Noncash charges Cash flows from investing activities Cash flows from financing activities: Ending cash balance