Stellar Corporation has contracted with you to prepare a statement of cash flows. The controller has provided the following information Cash Accounts receivable Inventory Equity investments Buildings Equipment December 31 2020 2019 $38,900 $12.900 12,100 9.900 11.900 10,000 -0- 3,000 -0- 30,000 40,400 20,100 Copyrights 5,000 5,300 Totals $108,300 $91,200 Allowance for doubtful accounts $3,000 $4,500 Accumulated depreciation-equipment 2,000 4,500 Accumulated depreciation-buildings -0- 6,000 Accounts payable 5,000 4,000 Dividends payable -O- 5,000 2,900 4,000 Notes payable, short-term (nontrade) Long-term notes payable Common stock 36,000 25,000 38,000 33,000 Retained earnings 21,400 5,200 $108,300 $91,200 Additional data related to 2020 are as follows. 1. 2. 3. 4. Equipment that had cost $11,100 and was 30% depreciated at time of disposal was sold for $2,600. $5,000 of the long-term note payable was paid by issuing common stock. Cash dividends paid were $5,000. On January 1, 2020, the building was completely destroyed by a flood. Insurance proceeds on the building were $33,000 (net of $3,900 taxes). Equity investments (ownership is less than 20% of total shares) were sold at $1.500 above their cost. No unrealized gains or losses were recorded in 2020. Cash and a long-term note for $16,000 were given for the acquisition of equipment Interest of $2,000 and income taxes of $5.000 were paid in cash. 5. 6. 7. (a) Use the indirect method to analyze the above information and prepare a statement of cash flows for Stellar. (Show amounts that decrease cash flow with either a-sign eg. -15,000 or in parenthesis eg. (15,000).) STELLAR CORPORATION Statement of Cash Flows For the Year Ended December 31, 2020 Cash Flows from Operating Activities Net Income 16200 Adjustments to reconcile net income to Net Cash Provided by Operating Activities Loss on Sale of Equipment 5170 Gain from Flood Damage - 12900 Depreciation Expense 39230 Copyright Amortization 300 Gain on Sale of Investment - 1500 Increase in Accounts Receivable (Net) 3700 Increase in Inventory 1900 Increase in Accounts Payable 1000 36900 53100 DOMA _ IN IONE HO Supplemental disclosures of cash flow information: $ $ IN