QUESTION #4 (20 marks) White Horse Ltd. has prepared the following comparative statements of financial position at December 31, 2019 and 2020:

White Horse adheres to ASPE.

2020 2019

Cash $ 99,000 $ 51,000

Accounts receivable 53,000 39,000

Inventory 50,000 60,000

Prepaid expenses 6,000 9,000

Property, plant & equipment 420,000 350,000

Accumulated depreciation (150,000) (125,000)

Goodwill 51,000 58,000

Totals $ 529,000 $ 442,000

Accounts payable $ 51,000 $ 56,000

Accrued liabilities 20,000 14,000

Mortgage payable 0 150,000

Preferred shares 215,000 0

Common shares 200,000 200,000

Retained earnings 43,000 22,000 $ 529,000 $ 442,000

1. The Accumulated Depreciation account has been credited only for the depreciation expense for the year. There were no disposals of property, plant and equipment, but new equipment was purchased during 2020.

2. Depreciation expense and a charge for impairment of goodwill have both been included in operating expenses.

3. The Retained Earnings account was debited for cash dividends declared and paid of $ 46,000, and credited for the net income for the year.

The condensed income statement for 2020 is as follows:

Sales $ 660,000

Cost of sales 363,000

Gross profit 297,000

Operating expenses 230,000

Net income $ 67,000

Instructions: 1. From the information above, prepare a complete statement of cash flows (using either the direct or indirect method)in good form for calendar 2020.