Dreamboat Company Had the Following Information for the Year Ended

Essay

Dreamboat Company had the following information for the year ended December 31, 20X6, and at December 31, 20X5: $$\begin{array} { l l l } & \underline { 12 / 31 / 20 \times 6 } & \underline { 12 / 31 / 20 \times 5 } \\\text { Fixed ass ets } & \$ 186,000 & \$ 156,000 \\\text { Accumulated depreciation } & ( 62,000 ) & ( 54,000 )\end{array}$$ Depreciation expense for 20X6 was $18,000. Equipment which originally cost $20,000 with accumulated depreciation of $10,000 was sold at a $3,000 loss.
Required:
Determine how these events would appear on Dreamboat Company's statement of cash flows for the year ended December 31, 20X6, assuming that Dreamboat Company uses the direct method.