Use the following data for ABC Music Co. to prepare a statement of cash flows using the indirect method for the year ended June 30 2016.ABC Music Co.Income StatementFor the Year Ended June 30 2016Net Sales $350000Less Expenses Cost of Goods Sold $200000 Depreciation Expense 20000 Administrative Expenses 52000 Selling Expenses 45000 Loss on Sale of Investment 500 Total Expenses 317500Net Income $ 32500ABC Music Co.Comparative Balance SheetsJune 30 2016 and 2015Assets 2016 2015Cash 4500 $ 15000Accounts Receivable (net) 35000 27500Inventory 40000 50000Prepaid Expenses 3000 2500Long Term Investments 20000 25000Plant and Equipment 80000 40000Accumulated Depreciation (20000) (12000)Total Assets $162500 $148000LiabilitiesAccounts Payable $ 2000 $ 6000Wages Payable 220 260Taxes Payable 780 740Notes Payable 20000 12000Total Liabilities $23000 $ 19000Stockholders EquityCommon Stock $ 65000 $ 65000Retained Earnings 81500 64000Total Paid in Capital and Retained Earnings 146500 129000 Less: Treasury Stock ( 7000) 0Total Stockholders Equity $139500 $129000Total Liabilities and Stockholders Equity $162500 $148000Additional Information: A plant asset costing $20000 was sold for its book value of $8000. And additional plant asset was purchased for $60000. A long term investment was sold for $4500. The outstanding notes are long term. An $8000 note was issued during 2016. Common stock was repurchased.
