Answer full question. 1RequiredPrepare a statement of cash flows using the indirect method. (Amounts to be deducted should be indicated with a minus sign.)GYPSY COMPANYStatement of Cash Flows10For the Year Ended December 31, Year 2pointsCash flows from operating activities:Less: Increases in current assets and Decreases in current liabilities:Plus: Noncash charges 1The comparative balance sheets and income statements for Gypsy Company follow.Balance SheetsAs of December 31Year 2Year 1Assets$ 23,0662,3636,23422,388(11,285)16,234$ 59,000Cash10pointsAccounts receivableInventoryEquipmentAccumulated depreciation-equipment$ 2,7211,4185,84443,788(18,341)8,914LandeBookTotal assets$ 44,344Liabilities and equityAccounts payable (inventory)Long-term debtCommon stockRetained earnings$ 2,7142,85821,40032,028$ 59,000$ 4,3846,5329,80024,428Total liabilities and equity$ 44,344Income StatementFor the Year Ended December 31, Year 2$ 30,250(11,990)18,260(3,680)14,580700(80)Sales revenueCost of goods soldGross marginDepreciation expenseOperating incomeGain on sale of equipmentLoss on disposal of landNet income$ 15,200Additional Data1. During Year 2, the company sold equipment for $18,364; it had originally cost $28,400. Accumulated depreciation on thisequipment was $10,736 at the time of the sale. Also, the company purchased equipment for $7,000 cash,2. The company sold land that had cost $5,080. This land was sold for $5,000, resulting in the recognition of a $80 loss. Also,common stock was issued in exchange for title to land that was valued at $12,400 at the time of exchange.3. Paid dividends of $7,60O.

Sharp Screen Films Inc. Cash Flow Statement (Indirect Method) For the year ended December 31 Cash Flow from Operating Activities Amount (In $) Amount (In $) Net Profit (Loss) 15,200 Depreciation Expense 3,680 Gain on Sale of Equipment (700) Loss on Sale of Land 80 Changes in Current Assets and Current Liabilities: Increase in accounts receivable (945) Increase in Merchandise Inventory (390) Decrease in accounts Payable (1,670) Net cash generated from (used in) operating activities (A) 15,255 Cash Flow from Investing Activities Sale of Land 5,000 Purchase of Equipment (7,000) Sale of Equipment 18,364 Net cash generated from (used in) Investing activities (B) 16,364 Cash Flow from Financing Activities Dividends Paid (7,600) Decrease in Long term debt (3,674) Net cash generated from (used in) Financing activities (C ) (11,274) Net cash generated from (used in) Operating Activities, Investing Activities and Financing activities (A) + (B) + (C ) 20,345 Opening Balance of cash and Cash Equivalents 2,721 Closing Balance of cash and Cash Equivalents 23,066Land Debit Credit Particulars Amount (In $) Particulars Amount (In $) Balance b/d 8,914 Loss on Sale of Land 80 Common Stock 12,400 Cash 5,000 Balance c/d 16,234 Total 21,314 Total 21,314 Equipment Debit Credit Particulars Amount (In $) Particulars Amount (In $) Balance b/d 43,788 Sale of Equipment 28,400 Cash 7,000 Balance c/d 22,388 Total 50,788 Total 50,788 Accumulated Depreciation Debit Credit Particulars Amount (In $) Particulars Amount (In $) Sale of Equipment 10,736 Balance b/d 18,341 Depreciation Expense 3,680 Balance c/d 11,285 Total 22,021 Total 22,021 Sale of Equipment Debit Credit Particulars Amount (In $) Particulars Amount (In $) Equipment 28,400 Accumulated depreciation 10,736 Gain on Sale of equipment 700 Cash 18,364 Total 29,100 Total 29,100 Common Stock Debit Credit Particulars Amount (In $) Particulars Amount (In $) Balance b/d 9,000 Land 12,400 Balance c/d 21,400 Total 21,400 Total 21,400 Retained Earnings Debit Credit Particulars Amount (In $) Particulars Amount (In $) Dividends Paid 7,600 Balance b/d 24,428 Net Income 15,200 Balance c/d 32,038 Total 39,638 Total 39,628