ICE Drilling Inc.'s balance sheet information and income statement are as follows: $1,110,200 553,000 $ 557,200 ICE Drilling Inc. Income Statement For Year Ended December 31, 2020 Sales Cost of goods sold Gross profit Operating expenses: Depreciation expense $ 35,000 Other expenses 304, 360 Total operating expenses Profit from operations Loss on sale of equipment Profit before taxes Income taxes Profit 339,360 $ 217,840 10,080 $ 207,760 25,760 $ 182,000 ICE Drilling Inc. Comparative Balance Sheet Information December 31 2020 2019 Cash $ 104,680 $ 164,640 Accounts receivable 138,600 104,160 Merchandise inventory 606,200 558,600 Prepaid expenses 11,970 13,000 Equipment 355,880 239, 400 Accumulated depreciation 70,560 91,560 Accounts payable 193,930 279,840 Current notes payable 15,400 7,000 Notes payable 210,000 119,000 343,000 443,800 Common shares Retained earnings 283, 640 239,400 ICE Drillina's artivities durina 2020. Additional information regarding ICE Drilling's activities during 2020: 1. Loss on sale of equipment is $10.080. 2. Paid $68.880 to reduce a long-term note payable. 3. Equipment costing $98,000, with accumulated depreciation of $56,000, is sold for cash. 4. Equipment costing $214.480 is purchased by paying cash of $54,600 and signing a long-term note payable for the balance. 5. Borrowed $8.400 by signing a short-term note payable. 6. Issued 10.080 common shares for cash at $10 per share. 7. Declared and paid cash dividends of $137,760. Required: Prepare a statement of cash flows for 2020 that reports the cash inflows and outflows from operating activities according to the indirect method. (List any deduction in cash and cash outflows as negative amounts.) ICE DRILLING INC. Statement of Cash Flows For Year Ended December 31, 2020 Cash flows from operating activities $ 182,000 Profit 35,000 Adjustments to reconcile profit to net cash inflows from operating activities Depreciation expense Loss on sale of equipment Increase in accounts receivable Increase in merchandise inventory Decrease in prepaid expenses Decrease in accounts payable 10,080 (34,440) (47,600) 1,030 (85,910) $ 60,160 Cash flows from investing activities HI Next >