Splish Inc., a greeting card company, had the following statements prepared as of December 31, 2020. SPLISH INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019 12/31/20 12/31/19 Cash $6,100 $7,100 Accounts receivable 61,500 51,000 Short-term debt investments (available-for-sale) 34,800 17,900 Inventory 39,800 59,900 Prepaid rent 5,000 4,000 Equipment 155,200 129,900 Accumulated depreciation-equipment (35,200) (24,800) Copyrights 45,800 49,800 Total assets $313,000 $294,800 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 Total liabilities & stockholders' equity $45,800 $39,800 6,000 7,900 3,900 8,000 9,900 60,100 68,900 100,000 100,000 30,000 30,000 57,100 36,300 $313,000 $294,800 SPLISH INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2020 Sales revenue $338,200 Cost of goods sold 174,500 Gross profit 163,700 Operating expenses 120,800 Operating income 42,900 Interest expense $11,400 Gain on sale of equipment 2,000 9,400 Income before tax 33,500 Income tax expense 6,700 Net income $26,800 Additional information: 1. Dividends in the amount of $6,000 were declared and paid during 2020. 2. Depreciation expense and amortization expense are included in operating expenses. 3. No unrealized gains or losses have occurred on the investments during the year. 4. Equipment that had a cost of $20,200 and was 70% depreciated was sold during 2020. 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 SPLISH INC. Statement of Cash Flows Cash Flows from Operating Activities - Net Income $ Adjustments to reconcile net income to Net Cash Provided by Operating Activities Depreciation Expense Gain on Sale of Equipment Amortization of Copyright Increase in Accounts Receivable Decrease in Inventories Increase in Prepaid Rent Increase in Accounts Payable Decrease in Income Taxes Payable Increase in Salaries and Wages Payable Net Cash Provided by Operating Activities Cash Flows from Investing Activities - Purchase of Investments Sale of Equipment Purchase of Equipment Net Cash Used by Investing Activities Cash Flows from Financing Activities Principal Payment on Short-term Loan Principal Payment on Long-term Loan - Dividend Payments Net Cash Used by Financing Activities - Net Increase in Cash Cash at Beginning of Period Cash at End of Period