Instant Brake Inc.s comparative balance sheet information at December 31, 2020 and 2019, and its income statement for the year ended December 31, 2020, are as follows:

Instant Brake Inc.

Income Statement

December 31, 2020

Sales $ 881,000

Cost of goods sold 570,000

Gross profit $ 311,000

Operating expenses $ 132,660

Depreciation expense 41,220 173,880

Operating Profit 137,120

Loss on sale of equipment 12,700

Investment income 19,520

Profit before taxes 143,940

Income taxes 18,000

Profit $ 125,940

Instant Brake Inc.

Balance Sheet Information

December 31

2020 2019 Net Change

Cash $ 42,000 $ 23,760 $ 18,240

Cash equivalents 25,280 8,400 16,880

Accounts receivable 87,120 31,440 55,680

Inventory 113,040 77,520 35,520

Investment 0 25,280 (25,280 )

Land 75,600 75,600 0

Building and equipment 417,820 437,340 (19,520 )

Accumulated depreciation 112,080 90,960 21,120

Accounts payable 11,260 36,600 (25,340 )

Dividends payable 2,000 1,200 800

Bonds payable 18,000 0 18,000

Preferred shares 80,400 80,400 0

Common shares 404,880 404,880 0

Retained earnings 132,240 65,300 66,940

During 2020, the following transactions occurred:

Purchased equipment for $20,800 cash.

Sold the investment on January 1, 2020, for $44,800, resulting in investment income of $19,520.

Sold equipment for $7,520 cash that had originally cost $40,320 and had $20,100 of accumulated depreciation.

Issued $18,000 of bonds payable at face value.

Other information:

All sales are credit sales.

All credits to accounts receivable in the period are receipts from customers.

All purchases of merchandise are on credit.

All debits to accounts payable in the period result from payments for merchandise.

Other operating expenses are cash expenses.

Income taxes are cash expenses.

Required:

Prepare a statement of cash flows for 2020 using the direct method to report cash inflows and outflows from operating activities. (List any deduction in cash and cash outflows as negative amounts.)

Check my Instant Brake Inc.'s comparative balance sheet information at December 31, 2020 and 2019, and its income statement the year ended December 31, 2020, are as follows: $881,000 570,000 $311,000 Instant Brake Inc. Income Statement December 31, 2020 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense Operating Profit Loss on sale of equipment Investment income Profit before taxes Income taxes Profit $132,660 41,220 173,880 137,120 12,700 19,520 143, 940 18,00 $125,940