Question - The following are comparative balance sheets and an income statement for the Cupcake Company.

Cupcake Company Balance Sheets As of December 31

                                                                                                   As of December 31

                                                                   2016              2015

Assets:

Cash                                                            $25,000         $100,000

Accounts receivable                                       163,500         125,000

Inventory                                                      183,000        220,000

Property, Plant and Equipment                         70,000         50,000

Less: Accumulated Depreciation                       (40,000)      (35,000)

Long-term investments                                    20,000        65,000

Valuation Allowance - LT Investments               4,000          2,000

Totals                                                            $425,500     $527,000

Liabilities and shareholders' equity:

Accounts payable - Merchandise                       $60,000      $110,000

Operating expenses payable                            29,500        25,000

Notes Payable                                                 10,000       -0-

Bonds payable                                                60,000       110,000

Common stock                                                150,000     125,000

Treasury Stock, Common                                 (10,000)    -0-

Retained earnings                                            122,000     155,000

Accumulated Other Comprehensive Income       4,000         2,000

  Totals                                                           $425,500    $527,000

Cupcake Company Income Statement For the Year Ended December 31, 2016

Sales                                                                             $571,000

Cost of Goods sold                                                          372,500

Gross Profit                                                                    $198,500

Operating expenses (excluding depreciation expense)        182,000

Depreciation expense                                                      5,000

Income from operations                                                  $11,500

Other expenses:

Loss on sale of long-term investment                               (4,500)

Net Income                                                                   7,000

Other comprehensive Income - Unrealized holding gains   2,000

Comprehensive Income                                                 $ 9,000

Additional Information 2016:

• Cash dividends were declared and paid in 2016.
• No stock dividends were declared or issued in 2016
• No Property, Plant or Equipment was sold in 2016
• During 2016, Property, Plant and Equipment of $10,000 was acquired by signing a $10,000 Notes Payable on the day of acquisition. All other acquisitions were paid with cash
• The following were purchased using cash: Long-term investments and Treasury Stock
• Any change in Bonds Payable relates to repayment of principle (face) amounts.
• All sales of Common Stock (No par value) were for cash

Prepare the Statement of Cash Flows of Cupcake Company for the year ended December 31, 2016. 

A. Prepare a Statement of Cash Flows (direct method) using the "Spreadsheet Approach" we demonstrated in class. 

B. Using your spreadsheet from A above prepare a Statement of Cash Flows, in good form, for the year ended December 31, 2016 (A reconciliation schedule is not required.) 

C. Submit both A and B electronically in Canvas using separate tabs for each.