December 31 2020 2019 Cash $56,300 $19,100 Accounts receivable 56,100 50,200 Inventory 81,100 84,000 Buildings -0- 177,000 Equipment Investments 195,000 119,000 -0- 41,600 Patents Total assets 25,200 29,500 $413,700 $520,400 Allowance for doubtful accounts $5,000 $4,500 Accumulated depreciation-building -0- 45,800 Accumulated depreciation-equipment 44,800 20,100 Accounts payable 75,400 72,900 Dividends payable 7,000 14,000 Notes payable, short-term 10,100 6,000 Long-term notes payable 49,900 264,000 Common stock 67,500 49,600 Retained earnings 154,000 43,500 Total liabilities and stockholders' equity $413,700 $520,400 Additional data related to 2020 are as follows. 1. Equipment that had cost $20,100 and was 60% depreciated at time of disposal was sold for $2,000. 2. $17,900 of the long-term note payable was paid by issuing common stock. 3. Cash dividends paid were $14,000. 4. 5. On January 1, 2020, the building was completely destroyed by a hurricane. Insurance proceeds on the building were $265,900. Investments (available-for-sale) were sold at $2,800 below their cost. The company has made similar sales and investments in the past. 6. Cash was paid for the acquisition of equipment. 7. A long-term note for $19,800 was issued for the acquisition of equipment. 8. Interest of $1,000 and income taxes of $23,400 were paid in cash. Prepare a statement of cash flows using the indirect method. Hurricane damage is unusual in that part of the country. (Show amounts that decrease cash flow with either a-sign e.g. -15,000 or in parenthesis e.g. (15,000).) Cash Flows from Operating Activities Net Income Statement of Cash Flows For the Year Ended December 31, 2020 Adjustments to reconcile net income to Net Cash Provided by Operating Activities Loss on Sale of Equipment Gain from Hurricane Damage Depreciation Expense Patent Amortization Loss on Sale of Investments 6040 -134700 36760 4300 2800 Increase in Accounts Receivable (Net). -5400 Decrease in Inventory 2900 Increase in Accounts Payable 2500 Net Cash Provided by Operating Activities 110500 -84800 Net Cash Provided by Operating Activities Cash Flows from Investing Activities Sale of Investments Sale of Equipment 38800 2000 Purchase of Equipment 81000 Proceeds from Hurricane Damage to Building 265900 Net Cash Provided by Investing Activities Cash Flows from Financing Activities Payment of Dividends Payment of Long-term Notes Payable Net Cash Used by Financing Activities Net Increase in Cash Cash, January 1, 2020. Cash, December 31, 2020 -14,000 17900 -84800 37200 56300 Net Cash Used by Financing Activities Net Increase in Cash Cash, January 1, 2020 Cash, December 31, 2020 Supplemental disclosures of cash flow information: SA 37200 56300