To prepare the cash flow statement, accountants for Craftique Inc. have summarized activity for the year 2020 in two accounts as follows:

Craftique Inc.’s income statement and selected balance sheet data follow:

Required

1. Prepare the cash flow statement of Craftique Inc. for the year ended December 31, 2020, using the direct method to report operating activities. Also prepare a note to the financial statements summarizing the non-cash investing and financing activities.

2. Prepare a schedule showing cash flows from operating activities using the indirect method. All activity in the current accounts results from operations.

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Cash 64,320 Payments on accounts payable 39,600 Payments of dividends Beginning balance 447,720 Collection of loan 52,640 Sale of investment 31,440 Payments of salaries and wages 172,560 39,120 Payments of interest 814,440 Purchase of equipment Receipts of interest 56,280 Collections from customers 37,680 33,360 Payments of operating expenses 25,400 Payment of long-term debt Issuance of common shares 41,160 Receipts of dividends 73,560 Repurchase of common shares Payment of income tax 20,280 22,680 Ending balance 123,120