Statement of cash flows (indirect method). The net changes in the balance sheet accounts of Keating Corporation for the year 2018 are shown below.

Account

Debit

Credit

Cash

$ 87,000

Short-term investments

$121,000

Accounts receivable

78,200

Allowance for doubtful accounts

13,300

Inventory

74,200

Prepaid expenses								22,800
Investment in subsidiary (equity method)								25,000

Plant and equipment

210,000

Accumulated depreciation

130,000

Accounts payable

80,700

Accrued liabilities

21,500

Deferred tax liability

15,500

8% serial bonds

70,000

Common stock, $10 par								90,000
Additional paid-in capital								150,000

Retained earningsAppropriation for bonded indebtedness

60,000

Retained earningsUnappropriated

38,000

________

$643,600

$643,600

An analysis of the Retained EarningsUnappropriated account follows:

Retained earnings unappropriated, December 31, 2017

$1,300,000

Add:	Net income	307,000
	Transfer from appropriation for bonded indebtedness	60,000

Total

$1,667,000

Deduct:	Cash dividends	$165,000
	Stock dividend	240,000		405,000

Retained earnings unappropriated, December 31, 2018

$1,262,000

1. On January 2, 2018 short-term investments (classified as available-for-sale) costing $121,000 were sold for $155,000. 2. The company paid a cash dividend on February 1, 2018. 3. Accounts receivable of $16,200 and $19,400 were considered uncollectible and written off in 2018 and 2017, respectively. 4. Major repairs of $33,000 to the equipment were debited to the Accumulated Depreciation account during the year. No assets were retired during 2018. 5. The wholly owned subsidiary reported a net loss for the year of $25,000. The loss was recorded by the parent. 6. At January 1, 2018, the cash balance was $166,000. Instructions Prepare a statement of cash flows (indirect method) for the year ended December 31, 2018. Keating Corporation has no securities which are classified as cash equivalents.

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