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Brecker Inc., a greeting card company, had the following statements prepared as of December 31, 2020. BRECKER INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31,

Brecker Inc., a greeting card company, had the following statements prepared as of December 31, 2020.

BRECKER INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019

12/31/20

12/31/19

Cash

$6,000

$7,000

Accounts receivable

62,000

51,000

Short-term debt investments (available-for-sale)

35,000

18,000

Inventory

40,000

60,000

Prepaid rent

5,000

4,000

Equipment

154,000

130,000

Accumulated depreciationequipment

(35,000

)

(25,000

)

Copyrights

46,000

50,000

Total assets

$313,000

$295,000

Accounts payable

$46,000

$40,000

Income taxes payable

4,000

6,000

Salaries and wages payable

8,000

4,000

Short-term loans payable

8,000

10,000

Long-term loans payable

60,000

69,000

Common stock, $10 par

100,000

100,000

Contributed capital, common stock

30,000

30,000

Retained earnings

57,000

36,000

Total liabilities & stockholders equity

$313,000

$295,000

BRECKER INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2020

Sales revenue

$338,150

Cost of goods sold

175,000

Gross profit

163,150

Operating expenses

120,000

Operating income

43,150

Interest expense

$11,400

Gain on sale of equipment

2,000

9,400

Income before tax

33,750

Income tax expense

6,750

Net income

$27,000

Additional information:

1. Dividends in the amount of $6,000 were declared and paid during 2020.
2. Depreciation expense and amortization expense are included in operating expenses.
3. No unrealized gains or losses have occurred on the investments during the year.
4. Equipment that had a cost of $20,000 and was 70% depreciated was sold during 2020.

Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

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