Comparative balance sheet accounts of Nash Inc. are presented below. NASH INC. COMPARATIVE BALANCE SHEET ACCOUNTS AS OF DECEMBER 31, 2020 AND 2019 December 31 Debit Accounts 2020 2019 Cash $42,400 $33,700 Accounts Receivable 70,500 60,500 Inventory 30,200 23,800 Equity investments 22,300 38,100 Machinery 30,300 18,700 Buildings 67,800 56,100 Land 7,500 7,500 $271,000 $238,400 Credit Accounts Allowance for Doubtful Accounts $2,300 $1,500 Accumulated Depreciation-Machinery 5,600 2,200 Accumulated Depreciation-Buildings 13,500 8,900 Accounts Payable 34,700 24,800 Accrued Payables 3,400 2,700 Long-Term Notes Payable 21,000 31,200 Common Stock, no-par 150,000 125,000 Retained Earnings 40,500 42,100 $271,000 $238,400 Additional data (ignoring taxes): 1. Net income for the year was $44,300. 2. Cash dividends declared and paid during the year were $20,900. 3. A 20% stock dividend was declared during the year. $25,000 of retained earnings was capitalized. 4. Equity investments (level of ownership is less than 20%) that cost $24,800 were sold during the year for $28,600. No unrealized gains and losses were recorded on these investments in 2020. 5. Machinery that cost $3,800, on which $750 of depreciation had accumulated, was sold for $2,250. Nash's 2020 income statement follows (ignoring taxes). Sales revenue $544,600 Less: Cost of goods sold 383,300 Gross margin 161,300 Less: Operating expenses (includes $8,750 depreciation and $5,217 bad debts) 120,000 Income from operations 41,300 Other: Gain on sale of investments $3,800 Loss on sale of machinery (800) 3,000 Net income $44,300 (a) Compute net cash flow from operating activities using the direct method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Net cash flow from operating activities $ (b) Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - signe.g. -15,000 or in parenthesis e.g. (15,000).) NASH INC. Statement of Cash Flows For the Year Ended December 31, 2020 (Indirect Method) Cash Flows from Operating Activities Net Income $ 44300 Adjustments to reconcile net income to Cash Flows from Financing Activities Loss on Sale of Machinery $ 800 Gain on Sale of Investments 3800 Increase in Accounts Receivable (Net) 9200 Increase in Inventory 6400 Increase in Accounts Payable 9900 Increase in Accounts Payable 700 Increase in Accounts Receivable (Net) 45050 Net Cash Used by Financing Activities Cash Flows from Investing Activities Sale of Investments 28600 Sale of Machinery 2250 Purchase of Investments 9000 Purchase of Machinery 15400 Addition to Buildings 11700 Net Cash Used by Investing Activities 5250 Cash Flows from Financing Activities Sale of Investments 28600 Sale of Machinery 2250 Net Cash Provided by Investing Activities 31100 Net Cash Provided by Financing Activities 8700 Cash, January 1, 2020 33700 Cash, December 31, 2020 $ 42400 e Textbook and Media