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Hartman, Inc. has prepared the following comparative balance sheets for 2019 and 2020: 2020 2019 Cash $138,500 $168,500 A/R 111,100 119,400 Less Allowance for bad

Hartman, Inc. has prepared the following comparative balance sheets for 2019 and 2020:

2020 2019

Cash $138,500 $168,500

A/R 111,100 119,400

Less Allowance for bad debt (2,100) (2,400)

Inventory 374,000 385,000

Prepaid rent 27,000 18,000

Plant assets 1,267,000 1,150,000

Less Acc Deprec (415,000) (375,000)

Equity method investment 57,500 0

Patent 153,000 174,000

Total $1,711,000 $1,637,500

Accounts payable $163,500 $168,000

Wages payable 75,000 42,000

Long-term note payable 345,000 352,000

Deferred tax liability 90,000 98,000

Bonds payable (with premium of $7,000 & $7,500) 307,000 307,500

Common Stock ($1 par) 300,000 300,000

Additional paid-in capital common stock 200,000 200,000

Retained earnings 230,500 170,000

Total $1,711,000 $1,637,500

The income statement for 2020 is as follows:

Sales revenue $1,980,000

Cost of goods sold (1,089,000)

Wages expense (472,000)

Rent expense (108,000)

Depreciation expense (55,000)

Patent amortization expense (21,000)

Bond interest expense (24,000)

Gain on sale of equipment 9,500

Equity method investment income 12,000

Income tax expense (87,000)

Net income $145,500

Additional information:

  1. Equipment with a cost of $32,000 and accumulated depreciation of $15,000 was sold during the year.
  2. Hartman made a 30% investment in Action, Co. for $50,000, on Jan 2, 2020. Action, Co. had total net income of $40,000 and paid total dividends of $15,000 in 2020.
  3. Dividends were declared and paid during 2020 (you need to calculate the amount)

(a) From the information above, prepare a statement of cash flows (indirect method) for Hartman, Inc. for the year ended December 31, 2020.

(b) From the information above, prepare a schedule of cash provided by operating activities using the direct method. (Only the operating section is needed for this one)

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