Question
Buffalo Ski Haus had the following statements prepared as of December 31, 2020. BUFFALO SKI HAUS COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND
Buffalo Ski Haus had the following statements prepared as of December 31, 2020. BUFFALO SKI HAUS COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019 12/31/20 12/31/19 Cash $2,500 $4,000 Accounts receivable 102,000 98,000 Short-term debt investments (available-for-sale) 98,000 121,000 Inventories 92,000 48,000 Prepaid insurance 4,000 6,100 Ski equipment 88,000 44,000 Accumulated depreciation—equipment (23,500) (18,000) Trademarks 78,000 85,000 Total assets $441,000 $388,100 Accounts payable $93,500 $72,000 Income taxes payable 21,600 15,000 Wages payable 4,000 9,000 Short-term loans payable 23,500 0 Long-term loans payable 76,200 124,000 Common stock, $1 par 100,000 100,000 Additional paid-in capital 20,000 20,000 Retained earnings 102,200 48,100 Total liabilities & stockholders’ equity $441,000 $388,100 BUFFALO SKI HAUS INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2020 Sales $538,700 Cost of goods sold 306,000 Gross profit 232,700 Operating expenses 93,000 Operating income 139,700 Interest expense $20,400 Loss on sale of equipment 4,000 24,400 Income before tax 115,300 Income tax expense 41,200 Net income $74,100 Additional information:
1. Dividends in the amount of $20,000 were declared and paid during 2020.
2. Depreciation expense and amortization expense are included in operating expenses.
3. Equipment that had a cost of $24,800 and was 20% 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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