Using the following information, complete an indirect method SCF in good form. The SCF should be presented in the worksheet labeled "Statement of Cash Flows".

This homework is worth a total of $10$possible points $--8$for the SCF and $2$for appropriate use of Excel $($i$.$e$.,$no amounts hard coded, use of formulas where possible and proper formatting$)$within the SCF$.$

Tips:

$1)$Follow the steps provided in class to create the SCF$,$including using supporting T accounts.

$2)$Record the journal entry for the sale of equipment to determine the cash effect of this transaction

$3)$If ending cash on the SCF doesn't equal ending cash per the Balance Sheet, you've made a mistake somewhere. To find the error, recheck your work once, then redo the problem if you can't find your error.

Martinez Inc

Balance Sheet and Income Statement Data

$12/31/202512/31/2024$

Current Assets:

Cash $ $5,900$$ $6,900$

Accounts Receivable $61,40051,200$

Inventory $45,20063,800$

Total Current Assets $112,500121,900$

PPE $152,700130,200$

Accumulated Depreciation $(35,400)(25,000)$

Land $80,40067,900$

Total Assets $ $310,200$$ $295,000$

Current Liabilities:

Accounts Payable $ $46,300$$ $40,400$

Wages Payable $12,0009,900$

LT Notes Payable $68,30079,500$

Total Liabilities $126,600129,800$

Stockholders' Equity:

Common Stock $130,000130,000$

Retained Earnings $53,60035,200$

Total Stockholders' Equity $183,600165,200$

Total Liabilities & Stockholders' Equity $ $310,200$$ $295,000$

Sales Revenue $ $335,000$

Less Cost of Goods Sold $175,125$

Gross Profit $159,875$

Operating Expenses $(120,100)$

Operating Income $39,775$

Interest Expense $(11,400)$

Gain on Sale of Equipment $2,500$

Income Before Taxes $30,875$

Less Income Tax Expense $6,075$

Net Income $ $24,800$

Additional Information:

$1)$The company sold equipment that had an original cost of $$20,100$

Amount equipment was depreciated at sale $70\%$

$2)$There have been no sales of land during the year.

$3)$Depreciation expense is included in operating expenses.

$4)$There have been no additional borrowings under the long term note payable.

$5)$There has been no repurchase of treasury stock.

$6)$Dividends were declared and paid during $2025$