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The following are Sullivan Corp.s comparative balance sheet accounts at December 31, 2014 and 2013, with a column showing th365,700 T Net Income Adjustments to reconcile net income to Net Cash Provided by Operating Activities Depreciation -124,900 G

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Sullivan Corp.
Statement of Cash Flows
For the Year Ended December 31, 2014
Net income $365700
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation $147390
Equity in earnings of Myers Co. ($33690)
Gain on sale of equipment ($3230)
Decrease in accounts receivable $40800
Increase in inventory ($135100)
Increase in accounts payable $61100
Decrease in income taxes payable ($19450)
$57820
Net cash provided by operating activities $423520
Cash flows from investing activities:
Proceeds from sale of equipment $39820
Loan to TLC Co. ($300580)
Principal payment of loan receivable $50760
Net cash used by investing activities ($210000)
Cash flows from financing activities:
Dividend paid ($99670)
Net cash used by financing activities: ($99670)
Net Increase in cash $113850
Cash January 1, 2014 $700730
Cash December 31, 2014 $814580
Non-cash investing and financing activities:
Issuance of capital lease liability for office building $399480

Calculation:

1. Depreciation for 2014

= Net increase in accumulated depreciation for the year ended December 31, 2014 + (Equipment sold cost - Equipment sold carrying value)

= $124900 + ($59080 - $36590)

= $147390

2. Gain on sale of equipment

= Proceeds - Carrying value

= $39820 - $36590

= $3230

3. Equity in earnings of Myers Co.

= Myers net income for 2014 * 25%

= $134760 * 25%

= $33960

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