Cash Accounts receivable (net) Inventory Prepaid expenses Equipment Accumulated depreciation Accounts payable Wages payable Income taxes payable Notes payable (long-term) Common shares Retained earnings June 30 2020 2019 $ 92,160 $ 47,000 102,000 75,600 80,220 116,220 6,540 6,300 162,000 150,000 34,800 18,000 32,400 39,600 9,600 20,400 2,940 4,380 54,000 90,000 282,000 222,000 27,180 740 $792,000 480,000 $312,000 Western Environmental Inc. Income Statement For Year Ended June 30, 2020 Sales Cost of goods sold Gross profit Operating expenses: Depreciation expense $ 70,380 Other expenses 80,460 Total operating expenses Profit from operations Gain on sale of equipment Profit before taxes Income taxes 150, 840 $ 161, 160 3,600 $164,760 61,160 Required: Use the Western Environmental Inc. information given below to prepare a statement of cash flows for the year ended June 30, 2020, using the indirect method. (List any deduction in cash and cash outflows as negative amounts.) a. A note is retired at carrying value, b. The only changes affecting retained earnings during 2020 are profit and cash dividends paid. c. New equipment is acquired during 2020 for $73,980. d. The profit on sale of equipment costing $61,980 during 2020 is $3,600. e. Prepaid expenses and wages expense affect other expenses on the income statement f. All sales and purchases of merchandise were on credit