Problem 23-2

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The comparative balance sheets for Skysong Corporation show the following information.

		December 31
		2017		2016
Cash		$33,100		$12,900
Accounts receivable		12,300		9,900
Inventory		12,100		8,900
Available-for-sale debt investments		0		3,100
Buildings		0		29,500
Equipment		45,000		20,100
Patents		5,000		6,200
		$107,500		$90,600
Allowance for doubtful accounts		$3,000		$4,500
Accumulated depreciationequipment		2,000		4,500
Accumulated depreciationbuilding		0		6,100
Accounts payable		5,000		3,100
Dividends payable		0		5,000
Notes payable, short-term (nontrade)		2,900		3,900
Long-term notes payable		31,000		25,000
Common stock		43,000		33,000
Retained earnings		20,600		5,500
		$107,500		$90,600

Additional data related to 2017 are as follows.

1.		Equipment that had cost $10,900 and was 40% depreciated at time of disposal was sold for $2,600.
2.		$10,000 of the long-term note payable was paid by issuing common stock.
3.		Cash dividends paid were $5,000.
4.		On January 1, 2017, the building was completely destroyed by a flood. Insurance proceeds on the building were $29,800 (net of $2,000 taxes).
5.		Investments (available-for-sale) were sold at $1,700 above their cost. The company has made similar sales and investments in the past.
6.		Cash was paid for the acquisition of equipment.
7.		A long-term note for $16,000 was issued for the acquisition of equipment.
8.		Interest of $1,900 and income taxes of $6,600 were paid in cash.

Prepare cash flows from operating activities using the indirect method. Flood damage is unusual and infrequent in that part of the country. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

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