Problem 23-02

The comparative balance sheets for Waterway Corporation show the following information.

		December 31
		2020		2019
Cash		$33,600		$13,100
Accounts receivable		12,100		10,000
Inventory		12,100		9,000
Available-for-sale debt investments		0		3,100
Buildings		0		29,400
Equipment		45,000		20,200
Patents		4,900		6,300
		$107,700		$91,100
Allowance for doubtful accounts		$3,100		$4,500
Accumulated depreciationequipment		2,000		4,500
Accumulated depreciationbuilding		0		5,900
Accounts payable		4,900		3,100
Dividends payable		0		5,000
Notes payable, short-term (nontrade)		3,000		4,100
Long-term notes payable		31,000		25,000
Common stock		43,000		33,000
Retained earnings		20,700		6,000
		$107,700		$91,100

Additional data related to 2020 are as follows.

1.		Equipment that had cost $11,000 and was 40% depreciated at time of disposal was sold for $2,500.
2.		$10,000 of the long-term note payable was paid by issuing common stock.
3.		Cash dividends paid were $5,000.
4.		On January 1, 2020, the building was completely destroyed by a flood. Insurance proceeds on the building were $29,900 (net of $2,000 taxes).
5.		Debt investments (available-for-sale) were sold at $1,800 above their cost. The company has made similar sales and investments in the past.
6.		Cash was paid for the acquisition of equipment.
7.		A long-term note for $16,000 was issued for the acquisition of equipment.
8.		Interest of $2,100 and income taxes of $6,500 were paid in cash.

Prepare a statement of cash flows using the indirect method.