Country Feed Inc., a Saskatchwan-based farm and ranch livestock feed distributor, began operations on January 1, 2019. Its post-closing trial balance at December 31, 2019 and 2020 is shown below along with some other information.

Other information regarding Country Feed Inc. and its activities during 2020:

1. Assume all accounts have normal balances.

2. Cash dividends were declared and paid during the year.

3. Plant assets worth $70,000 were purchased during the year by paying cash of $20,000 and issuing a longterm note payable for the balance.

4. Plant assets were sold during the year.

Required

Using the information provided, prepare a statement of cash flows (applying the indirect method) for the year ended December 31, 2020.

Analysis Component: Country Feed Inc.?s income statement showed a loss of $7,600 for the year ended December 31, 2020, yet the statement of cash flows shows net cash inflows from operating activities of $4,000 for the same period. Explain what this difference means.

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Country Feed Inc. Income Statement Country Feed Inc. Post-Closing Trial Balance For Year Ended December 31, 2020 December 31 2020 Revenues: Sales. Cost of goods sold. Gross profit.. Expenses and other: Other expenses. Account 2019 513,600 $ 63,200 $ 65,200 121,600 128,400 43,200 Cash. Receivables Merchandise inventory. Property, plant, and equipment. Accumulated depreciation. Accounts payable. Accrued liabilities. Notes payable. Common shares Retained earnings. 343,600 170,000 38,800 298,400 272,400 167,600 165,600 167,600 Depreciation expense. Total expenses and other. Operating profit (loss). Gain on sale of plant assets. Profit (Loss). 18,000 78,000 7,200 78,800 5,600 115,200 185,600 (15,600) 8,000 75,200 80,000 80,000 (7,600) 79,200 98,800