The 2012 and 2011 comparative balance sheets and 2012 income statement of Perfect Supply Corp. follow:

Income statement

Perfect Supply had no non-cash investing and financing transactions during 2012. During the year, there were no sales of land or equipment, no payment of notes payable, no retirements of stock, and no treasury stock transactions.
Requirements
1. Prepare the 2012 statement of cash flows, formatting operating activities by using the indirect method.
2. How will what you learned in this problem help you evaluate aninvestment?

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Perfect Supply Corp. Comparative Balance Sheets December 31, 2012 Increase 2011 (Decreasel Current assets: Cash and cash equivalents Accounts receivable Inventories Prepaid expenses $ 47,5005,000 $42,500 1,000 52.200 13,000 61,000 65,200 60,000 2,500 1,000 1,500 Plant assets: Land Equipment, net 48,400 32,600 15,800 64,100 15,000 $288,700 $199,900 $88,800 49,100 Total assets Current liabilities: Accounts payable Salary payable Other accrued liabilities 35,400 28,000 7,400 32,000 22,800 24,100 (1,300) 36,500 (4,500) Long-term liabilities: Notes payable 58,000 30,000 28,000 Stockholders' equity: Common stock, no-par Retained earnings 88,500 64,300 24,200 52,000 35,000 Total liabilities and stockholders' equity $288,700 199,900 $88,800 17,000 Perfect Supply Corp Income Statement Year Ended December 31, 2012 Revenues: Sales revenue $441,000 Expenses: Cost of goods sold Salary expense Depreciation expense Other operating expense Interest expense Income tax expense $185,300 76,900 15,000 50,200 24,800 29,100 Total expenses 381,300 S 59,700 Net income