Indirect Method Preparing a Statement of Cash Flows

Kidman Corp. reported the following financial statements for the year ended December 31, 2020.

Required

Prepare the statement of cash flows for Kidman Corp. for the year ended December 31, 2020, using the indirect method.

Difference $19,000 (2,000) 14,000 Balance Sheet, December 31 2019 2020 Cash and cash equivalents $12,000 $31,000 Accounts receivable 9,500 7,500 Merchandise inventory 15,500 29,500 Land 10,000 2,000 Equipment 24,000 36,000 Accumulated depreciation (6,000) (12,000) Total assets $65,000 $94,000 Accounts payable $ 8,000 $9,000 Notes payable, long-term 3,500 1,000 Bonds payable 15,000 Common stock (no-par) 40,000 46,000 Retained earnings 13,500 23,000 Total liabilities and stockholders' equity $65,000 $94,000 (8,000) 12,000 (6,000) $29,000 $1,000 15,000 6,000 9,500 $29,000 Income Statement For Year Ended December 31, 2020 Revenues Cost of goods sold Depreciation Other expenses Loss on sale of land Net income $76,000 41,000 6,000 7,000 5,000 $17,000 Statement of Cash Flows For the Year Ended December 31, 2020 Cash flows from operating activities Net income Adjustments Depreciation expense $ Loss on sale of land Decrease in accounts receivable Increase in merchandise inventory Increase in accounts payable Net cash provided by operating activities Cash flows from investing activities Sale of land Purchase of equipment Net cash used by investing activities Cash flows from financing activities Payment on long-term note issuance Issuance of bond payable Issuance of common stock Cash paid for dividends Net cash provided by financing activities Net increase in cash and cash equivalents during 2020 Cash and cash equivalents, January 1, 2020 Cash and cash equivalents, December 31, 2020 12000