• Complete the following problem
• Show calculations behind your answers where possible and explain your reasoning

Grant Wood Corporations balance sheet at the end of 2019 included the following items:

Current assets (Cash $82,000) $235,000 Current liabilities $150,000

Land 30,000 Bonds payable 100,000

Buildings 120,000 Common stock 180,000

Equipment 90,000 Retained earnings 44,000

Accum. Depr.-buildings (30,000) Total $474,000

Accum. Depr.-equipment (11,000)

Patents 40,000

Total $474,000

The following is available for 2020:

1. Net income was $55,000.
2. Equipment (cost $20,000 and accumulated depreciation $8,000) was sold for $10,000.
3. Depreciation expense was $4,000 on the building and $9,000 on equipment.
4. Patent amortization was $2,500.
5. Current assets other than cash increased by $29,000. Current liabilities increased by $13,000.
6. An addition to the building was completed at a cost of $27,000.
7. A long-term investment in stock was purchased for $16,000.
8. Bonds payable of $50,000 were issued.
9. Cash dividends of $30,000 were declared and paid.
10. Treasury stock was purchased at a cost of $11,000.

Instructions:

(Show only totals for current assets and current liabilities)

1. Prepare a statement of cash flows for 2020.
2. Prepare a balance sheet at December 31, 2020.