The 20X8 comparative balance sheet and income statement of Riverbend Pools, Inc., follows. Riverbend had no noncash investing and financing transactions during 20X8. During the year, there were no sales of land or equipment, no issuances of notes payable, no retirements of stock, and no treasury stock transactions.

Required

1. Prepare the statement of cash flows of Riverbend Pools, Inc., for the year ended

December 31, 20X8. Format operating activities by the indirect method.

2. How will what you learned in this problem help you evaluate an investment? (Challenge)

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Riverbend Pools, Inc. Comparative Balance Sheet December 31, 20X8 and 20X7 Increase 20x7 Decrease) 20x8 Current assets: Cash and cash equivalents.. $ 28,700 15,600 $13,100 3,100 89,900 4,400 Accounts receiva ble Inventories 47,100 94,300 44,000 Prepaid expenses 1,700 2,200 (500) Plant assets: Land 35,100 100.900 10,000 25,100 93,7007200 $307,800 $255,400 $52,400 Equipment, net Total assets Current liabilities: Accounts payable Salary pa yable Other accrued liabilities 22,700 24,600 (1,900) 700 22,5001,900 2,100 24,400 1,400 Long-term liabilities: Notes payable 55,000 65,000 (10,000) Stockholders' equity: Common stock, no-par Retained ear nings 131,100 122,300 8,800 19,600 52,900 $307,800 $255,400 $52,400 72,500 Total liabilities and stockholders' equity Riverbend Pools, Inc Income Statement for 20xs Revenues: Sa les revenue $438,000 11,700 449,700 Interest revenue .. lotal revenues. Expenses: Cost of goods sold. Sa lary expense $185,200 76,400 49,700 24,600 16,900 Other operating expense. Income tax expense Total expenses 368,100 $81,600 Net inco