Sheet1This is a comprehensive problem all contained on this spreadsheet tab. You are to prepare a cash flow statement, a verticalanalysis, a horizontal analysis, and some ratio calculations. Scroll down the spreadsheet to complete each part.Philadelphia Widget Corporation is in the process of preparing financial statements for the year ended 12/31/2015.They have completed the balance sheet and income statement as shown.Philadelphia Widget CorporationIncome StatementFor the year ended 12/31/2015Revenue1,235,000Cost of Goods Sold806,356Gross Profit428,644Administrative Expenses: Salaries212,450 Rent82,500 Depreciation24,800 Total Administrative Expense319,750Operating Profit108,894Gain on Sale of Equipment4,500Interest Expense(42,115)Net Income71,279Philadelphia Widget CorporationBalance SheetAs of 12/31/2015, 12/31/2014, and 12/31/2013Cash119,41189,564105,644Accounts Receivable85,45583,11878,400Inventory41,60048,56062,600Prepaid Expenses14,50018,10024,000 Total Current Assets260,966239,342270,644Land50,00050,00050,000Buildings and Equipment182,450172,450166,800Accumulated Depreciation78,900103,55062,600109,85054,580112,220 Total Assets414,516399,192432,864Accounts Payable62,52551,48045,200Wages payable4,5004,5001,500Unearned Revenue3,000- 0- 0Current Portion of Long-Term Debt50,00050,00050,000 Total Current Liabilities120,025105,98096,700Long-Term Debt175,000225,000275,000Common Stock, 3500 shares outstanding35,00035,00035,000Retained Earnings84,49133,21226,164 Total Stockholders' Equity119,49168,21261,164Total Liabilities and Equity414,516399,192432,864A. Prepare a Statement of Cash Flow using the indirect method for 2015 using the above statements and the following additional information: 1. Equipment costing $30,000 was purchased in 2015. 2. Equipment having an original cost of $20,000 and accumulated depreciation of $8,500 was sold for $16,000 during 2015. 3. A dividend of $20,000 was declared and paid in 2015.Philadelphia Widget CorporationStatement of Cash FlowFor the year ended 12/31/2015Cash flows from Operating ActivitiesNet Income71,279Adjustments Gain on sale of equipment(4,500)Depreciation Expense24,800Increase in Accounts Receivable(2,337)Decrease in Inventory6,960Decrease in Prepaid Expense3,600Increase in Accounts Payable11,045Increase in Unearned revenue3,00042,568Net cash flow from Operating Activities113,847Cash flows from Investing ActivitiesSale proceeds of sale of equipment16,000Purchase of Equipment(30,000)Net cash out-flow from Operating Activities(14,000)Cash flows from Financing ActivitiesPayment of Dividends(20,000)Repayment of Long term debt(50,000)Net cash out-flow from Financing Activities(70,000)Net Increase in cash29,847Cash Balance - Beginning89,564Cash Balance - Ending119,411B. Prepare a vertical analysis (1 year) of the income statement above and a horizontal analysis (2 years) of the balance sheet.Philadelphia Widget CorporationVertical Analysis of Income Statement2015AmountPercentRevenue1235000.