LAG Network Inc.'s balance sheet and income statement are as follows: $ 928,680 556,200 $ 372,400 LAG Network Inc. Income Statement For Year Ended December 31, 2020 Sales Cost of goods sold Gross profit Operating expenses: Depreciation expense 25, 200 Other expenses 232,800 Total operating expenses Profit from operations Income taxes Profit 258,000 $ 114,400 18,600 $ 95,800 LAG Network Inc. Comparative Balance Sheet Information December 31 Assets 2020 2019 Cash $ 81,190 $ 54,400 Accounts receivable 42,400 37,600 Merchandise inventory 284,710 247,800 Equipment 154,400 138,400 Accumulated depreciation (71,800) (46,600 Total assets $ 490,900 $ 431,600 Liabilities and Equity Accounts payable $ 31,200 $ 43,800 Income axes payable 11,600 10,200 mon charac 26 A 227 50 ACT May LAG Network Inc. Comparative Balance Sheet Information December 31 Assets 2020 2019 Cash $ 81,199 $ 54,400 Accounts receivable 42,400 37,600 Merchandise inventory 284,710 247,800 Equipment 154,400 138,400 Accumulated depreciation (71,800) (46,600) Total assets $ 499,900 $ 431,600 Liabilities and Equity Accounts payable $ 31,200 $ 43,800 Income taxes payable 11,600 10,200 Common shares 363,000 337,500 Retained earnings 85,100 40,100 Tota liabilities and equity $ 499,900 $ 431,600 Additional information regarding LAG Network Inc.'s activities during 2020: a. Equipment is purchased for $16,000 cash. b. 10,200 common shares are issued for cash at $2.50 per share. c. Declared and paid $50,800 of cash dividends during the year. Other information regarding LAG Network Inc.: a. All sales are credit sales. b. All credits to accounts receivable are receipts from customers. c. All purchases of merchandise are on credit. Active Other information regarding LAG Network Inc.: a. All sales are credit sales. b. All credits to accounts receivable are receipts from customers. c. All purchases of merchandise are on credit d. All debits to accounts payable result from payments for merchandise. e. Other operating expenses are cash expenses. f. The only decrease in income taxes payable is for payment of taxes. 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.) LAG NETWORK INC. Statenent of Cash Flows For Year Ended December 31, 2020 Cash flows from operating activities LAG NETWORK INC. Statement of Cash Flows For Year Ended December 31, 2020 Cash flows from operating activities: Cash flows from investing activities: Cash flows from financing activities
