Refer to the data in QS 12-7. 

1. Assume that all common stock is issued for cash. What amount of cash dividends is paid during 2020? 

2. Assume that no additional notes payable are issued in 2020. What cash amount is paid to reduce the notes payable balance in 2020?

QS 12-7.

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CRUZ, INC. Comparative Balance Sheets At December 31 2020 2019 Assets $ 94,800 $ 24,000 Cash Accounts receivable, net 41,000 51,000 Inventory...... 85,800 95,800 Prepaid expenses. 5,400 4,200 Total current assets 227,000 175,000 Furniture .... 109,000 119,000 ..... Accum. depreciation-Furniture (17,000) (9,000) Total assets... $319,000 $285,000 CRUZ, INC. Income Statement Liabilitles and Equity Accounts payable... Wages payable.. Income taxes payable.. For Year Ended December 31, 2020 $ 15,000 $ 21,000 9,000 5,000 Sales .... $488,000 1,400 2,600 Cost of goods sold. 314,000 25,400 28,600 Total current liabilities Gross profit.. 174,000 Notes payable (long-term) 29,000 69,000 Operating expenses (excluding depreciation) Total liabilities... 54,400 97,600 89,100 Depreciation expense 37,600 Equity Common stock, $5 par value..... Retained earnings..... Total liabilities and equity.. Income before taxes. 47,300 229,000 179,000 Income taxes expense 17,300 35,600 8,400 Net income $ 30,000 $319,000 $285,000