A & R Problem 16-4 (Indirect method) The following items include the 2020 and 2019 balance sheet information and the 2020 income statement of the Clear Water Corporation. Additional information about the companys 2020 transactions is presented after the financial statements.

$ 120,000 50,000 70,000 Clear Water Corporation Income Statement For Year Ended December 31, 2020 Revenues : Sales Cost of goods sold Gross profit Operating expenses : Other expenses $ 54,800 Depreciation expense, buildings 2,000 Depreciation expense, equipment 4,000 Total operating expenses Profit from Operations Interest income Interest expense Gain on sale of long-term investment Loss on sale of equipment Profit before Taxes Income tax expense Profit $ 60,800 9,200 900 2,000 3,000 600 10,500 2,500 8,000 $ Clear Water Corporation Comparative Balance Sheet Information December 31 2020 2019 Cash and cash equivalents $ 1,000 $ 800 Accounts receivable 4,500 3,100 Merchandise inventory 19,000 16,000 Prepaid expenses 700 600 Investment in land 10,000 12,000 Land 9,000 4,000 Buildings 60,000 60,000 Accumulated depreciation, buildings 38,000 36,000 Equipment 21,000 16,000 Accumulated depreciation, equipment 6,000 4,000 Notes payable 5,000 3,500 Accounts payable 9,000 10,000 Other accrued liabilities 5,300 4,200 Interest payable 400 300 Taxes payable 300 500 Bonds payable, due in 2022 25,000 22,500 Common shares 16,000 14,000 Retained earnings 20,200 18,000 Additional information: 1. Received $5,000 from the sale of the land investment that originally cost $2,000. 2. Received $400 cash from the First National Bank on December 31, 2020, as interest income. 3. Sold old equipment for $1,400. The old equipment originally cost $4,000 and had accumulated depreciation of $2,000. 4. Purchased land costing $5,000 on December 31, 2020, in exchange for a note payable. Both principal and interest are due on June 30, 2021. 5. Purchased new equipment for $9,000 cash. 6. Paid $3,500 of notes payable. 7. Sold additional bonds payable at par of $3,000 on January 1, 2020. 8. Issued 1,000 common shares for cash at $2 per share. 9. Declared and paid a $5,800 cash dividend on October 1, 2020. Required: Prepare a statement of cash flows for Clear Water Corporation using the indirect method. (List any deduction in cash and cash outflows as negative amounts.) CLEAR WATER CORPORATION Statement of Cash Flows For Year Ended December 31, 2020 Cash flows from operating activities: Adjustments to reconcile profit to net cash provided by operating activities: Total adjustments $ 0 Cash flows from investing activities: Total adjustments $ Cash flows from investing activities: 0 Cash flows from financing activities: 0 0