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

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

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

12/31/20

12/31/19

Cash

$5,900

$7,000

Accounts receivable

61,500

51,300

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

35,000

17,800

Inventory

40,400

60,200

Prepaid rent

5,000

4,000

Equipment

153,400

129,000

Accumulated depreciationequipment

(35,100

)

(25,100

)

Copyrights

46,300

49,600

Total assets

$312,400

$293,800

Accounts payable

$46,500

$40,200

Income taxes payable

4,100

6,000

Salaries and wages payable

8,100

4,000

Short-term loans payable

7,900

10,000

Long-term loans payable

60,200

68,700

Common stock, $10 par

100,000

100,000

Contributed capital, common stock

30,000

30,000

Retained earnings

55,600

34,900

Total liabilities & stockholders equity

$312,400

$293,800

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

Sales revenue

$338,750

Cost of goods sold

176,400

Gross profit

162,350

Operating expenses

119,600

Operating income

42,750

Interest expense

$11,500

Gain on sale of equipment

2,000

9,500

Income before tax

33,250

Income tax expense

6,650

Net income

$26,600

Additional information:

1. Dividends in the amount of $5,900 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 $19,900 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).)

BUFFALO INC. Statement of Cash Flows choose the accounting period: December 31, 2020For the Year Ended December 31, 2020For the Quarter Ended December 31, 2020 December 31, 2020For the Year Ended December 31, 2020For the Quarter Ended December 31, 2020

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