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Problem 13-12 (Part Level Submission) The following financial statements were furnished by the Kokomo Company: Kokomo Company Balance Sheets As of December 31, 2016, and 2017 2016 2017 Assets Cash $15,510 $16,910 Accounts receivable 6,211 6,807 Inventory 8,010 9,263 Prepaid expenses 1,229 2,338 Plant and equipment 41,344 57,700 Accumulated depreciation (7,538 ) (7,445 ) Total assets $64,766 $85,573 Liabilities and Equity Accounts payable (all relate to inventory purchases) $4,644 $13,055 Accrued wages payable 1,295 1,763 Common stock 37,000 37,000 Retained earnings 21,827 33,755 Total liabilities and equity $64,766 $85,573 Kokomo Company Income Statement For the Year Ended December 31, 2017 Sales $40,200 Less cost of goods sold (12,864 ) Gross margin 27,336 Less wage expense (10,452 ) Less other operating expenses (1,206 ) Less depreciation expense (3,750 ) Net income (loss) $11,928 In 2017, Kokomo purchased equipment for $22,860 and sold some equipment for its book value (i.e., no gain or loss resulted).

(a) Your answer is partially correct. Try again. Prepare a statement of cash flows using the indirect method. (Enter amounts that decrease cash flow either with a negative sign preceding the number, e.g. -15,000 or parenthesis e.g. (15,000).) Kokomo Company Statement of Cash Flows Indirect method December 31, 2017For the Month Ended December 31, 2017For the Year Ended December 31, 2017 Cash flows from operating activities Net income $ Depreciation expense Increase in prepaid expenses Depreciation expense Net income Increase in accrued wages payable Decrease in accrued wages payable Increase in accounts payable Payments to purchase equipment Increase in accounts receivables Cash from sale of equipment Decrease in accounts receivables Decrease in prepaid expenses Decrease in inventory Decrease in accounts payable Increase in inventory Increase in accounts receivables Increase in accounts payable Increase in accrued wages payable Increase in inventory Net cash provided by operating activities Cash flows from investing activities Cash from sale of equipment Payments to purchase equipment Net cash used in investing activities Cash flows from investing activitiesNet cash provided by investing activitiesNet cash used in investing activitiesBeginning cash balance 2017Net increase in cashNet cash provided by financing activitiesNet cash provided by operating activitiesNet cash used in financing activitiesEnding cash balance 2017Cash flows from operating activitiesCash flows from financing activitiesNet cash used in operating activitiesNet decrease in cash Net decrease in cashNet increase in cashNet cash provided by investing activitiesNet cash used in investing activitiesNet cash provided by financing activitiesBeginning cash balance 2017Net cash used in financing activitiesCash flows from investing activitiesCash flows from financing activitiesEnding cash balance 2017Cash flows from operating activitiesNet cash provided by operating activitiesNet cash used in operating activities Ending cash balance 2017 $

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