The 2020 comparative balance sheet and income statement of Riverbend Pools Inc. follow. Riverbend had no non-cash investing and financing transactions during 2020. During the year, there were no sales of land or equipment, no issuances of notes payable, and no share repurchase transactions.{Requirements}

1. Prepare the statement of cash flows of Riverbend Pools Inc. for the year ended December 31, 2020. Determine cash flows from operating activities by the indirect method.

2. How will what you learned in this problem help you evaluate an investment?

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1 A Riverbend Pools Inc. Comparative Balance Sheet As at December 31, 2020 and 2019 B D E 2 2020 2019 Increase (Decrease) 3 Current assets: 4 Cash and cash equivalents $ 28,700 $ 15,600 $ 13,100 5 Accounts receivable 47,100 44,000 3,100 6 Inventories 94,300 89,900 4,400 7 Prepaid expenses 1,700 2,200 (500) 8 Property, plant, and equipment. 9 Land 35,100 10,000 25,100 10 11 12 Equipment, net Total assets Current liabilities: 100,900 93,700 7,200 $ 307,800 $255,400 $ 52,400 13 Accounts payable $ 22,700 $ 24,600 $ (1,900) 14 Salary payable 2,100 1,400 700 15 Other accrued liabilities 24,400 22,500 1,900 16 Long-term liabilities: 17 Notes payable 55,000 65,000 (10,000) 18 Shareholders' equity: 19 Common shares 131,100 222 20 Retained earnings 72,500 122,300 19,600 21 Total liabilities and shareholder's equity $307,800 $ 255,400 8,800 52,900 $ 52,400