Pharoah Inc., a greeting card company, had the following statements prepared as of December 31, 2020. PHAROAH INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019 12/31/20 Cash $5,900 Accounts receivable 62,000 Short-term debt investments (available-for-sale) 34,700 Inventory 39,700 Prepaid rent 4,900 Equipment 154,300 Accumulated depreciation-equipment (35,300) Copyrights 45,600 Total assets $311,800 12/31/19 $7,000 51,500 17,900 60,400 4,100 130,500 (25,200) 49,700 $295,900 Accounts payable Income taxes payable Salaries and wages payable Short-term loans payable Long-term loans payable Common stock, $10 par Contributed capital, common stock Retained earnings $46,200 4,000 8,100 8,000 60,200 100,000 30,000 55,300 $40,400 6,000 3,900 9,900 69,300 100,000 30,000 36,400 Retained earnings Total liabilities & stockholders' equity 55,300 $311,800 36,400 $295,900 PHAROAH INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2020 Sales revenue $335,600 Cost of goods sold 174,600 Gross profit 161,000 Operating expenses 120,700 Operating income 40,300 Interest expense $11,400 Gain on sale of equipment 2,100 9,300 Income before tax 31,000 Income tax expense 6,200 Net income $24,800 Additional information: 1. 2. Dividends in the amount of $5,900 were declared and paid during 2020. Depreciation expense and amortization expense are included in operating expenses. No unrealized gains or losses have occurred on the investments during the year. Equipment that had a cost of $19,800 and was 70% depreciated was sold during 2020. 3. 4. Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a in parenthesis e.g. (15,000).) PHAROAH INC. Statement of Cash Flows $ Adjustments to reconcile net income to > > $ > > > Net Increase in Cash >