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Comparative balance sheet accounts of Nash Inc. are presented below. NASH INC. COMPARATIVE BALANCE SHEET ACCOUNTS AS OF DECEMBER 31, 2020 AND 2019 December 31 Debit Accounts 2020 2019 Cash $41,900 $34,100 Accounts Receivable 70,400 60,300 Inventory 29,900 24,000 Equity investments 22,100 38,300 Machinery 30,200 18,900 Buildings 67,900 56,800 Land 7,400 7,400 $269,800 $239,800 Credit Accounts Allowance for Doubtful Accounts Accumulated Depreciation-Machinery Accumulated Depreciation-Buildings Accounts Payable Accrued Payables Long-Term Notes Payable Common Stock, no-par Retained Earnings $2,200 5,600 13,400 35,300 3,400 21,000 150,000 38,900 $269,800 $1,500 2,200 8,900 24,700 2,600 30,800 125,000 44,100 $239,800 Additional data llanarinatawae. Additional data (ignoring taxes): 1. Net income for the year was $40,900. 2. Cash dividends declared and paid during the year were $21,100. 3. A 20% stock dividend was declared during the year. $25,000 of retained earnings was capitalized. A Equity investments (level of ownership is less than 20%) that cost $25,200 were sold during the year for $29,000. No unrealized gains and losses were recorded on these investments in 2020. 5. Machinery that cost $3,700, on which $750 of depreciation had accumulated, was sold for $2,150. Nash's 2020 income statement follows (ignoring taxes). Sales revenue Less: Cost of goods sold Gross margin Less: Operating expenses (includes $8,650 depreciation and $5,364 bad debts) Income from operations Other: Gain on sale of investments Loss on sale of machinery Net income $538,000 380,200 157,800 119,900 37,900 $3,800 (800) 3,000 $40,900 (a) Compute net cash flow from operating activities using the direct method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Net cash flow from operating activities 41870 (b) Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) NASH INC. Statement of Cash Flows For the Year Ended December 31, 2020 (Indirect Method) Cash Flows from Operating Activities 40900 Net Income Adjustments to reconcile net income to Net Cash Provided by Operating Activities Depreciation Expense 7150 Gain on Sale of Investments (3800) T Loss on Sale of Machinery 800 Increase in Accounts Receivable (Net) - (9400) Increase in Inventory (5900) T Increase in Accounts Payable 10600 T Increase in Accrued Payables 800 250 Net Cash Provided by Operating Activities 41150 TCash Flows from Investing Activities A T Sale of Investments 29000 T Sale of Machinery 2150 T Purchase of Investments (9000) T Addition to Buildings (11100) T Purchase of Machinery (13500) T Net Cash Used by Investing Activities (2450)
