The comparative balance sheets for Vaughn Corporation show the following information. December 31 4. 2020 2019 On January 1, 2020, the building was completely destroyed by a flood. Insurance proceeds on the building were $30,300 (net of $2,000 taxes). Cash $33,200 $13,000 5. Debt investments (available-for-sale) were sold at $1,700 above their cost. The company has made similar sales and investments in the past. Accounts receivable 12,200 10,100 6. Cash was paid for the acquisition of equipment. Inventory 12,100 8,900 7. A long-term note for $16,000 was issued for the acquisition of equipment. Available-for-sale debt investments -0- 2,900 8. Interest of $2,000 and income taxes of $6,500 were paid in cash. Buildings -0- 30,100 Equipment 45,300 20,200 Patents 5,000 6,300 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 eg. (15.0001) $107,800 $91,500 Allowance for doubtful accounts $3,000 $4,500 Accumulated depreciation-equipment 2,000 4,500 Accumulated depreciation-building -0- 6,000 Accounts payable 5,000 2,900 Dividends payable -0- 5,000 Notes payable, short-term (nontrade) 3,000 4,000 Long-term notes payable 31,000 25,000 Common stock 43,000 33,000 Retained earnings 20,800 6,600 $107,800 $91,500 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. Question 7 of 7 12.07/25 ! Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a -sign e.g. -15,00 parenthesis e.g. (15,000).) Cash Flows from Operating Activities VAUGHN CORPORATION Statement of Cash Flows For the Year Ended December 31, 2020 Net Income Adjustments to reconcile net income to Loss on Sale of Investments 4600 Purchased Equipment by Issuing Notes Payable (36100) Proceeds from Flood Damage to Building Net Cash Provided by Investing Activities Cash Flows from Financing Activities Payment of Dividends Net Cash Provided by Operating Activities Patent Amortization Increase in Accounts Receivable (Net) 12200 Net Cash Used by Financing Activities Increase in Inventory Increase in Accounts Payable Depreciation Expense Loss on Sale of Equipment Decrease in Accounts Receivable (Net) Gain from Flood Damage Sale of Equipment Net Cash Provided by Operating Activities Cash Flows from Investing Activities Gain on Sale of Equipment 12100 Net Increase in Cash 5000 Cash, January 1, 2020 (1900) Cash, December 31, 2020 Supplemental disclosures of cash flow information: Net Income Increase in Accounts Receivable (Net) Noncash Investing and Financing Activities Purchased Equipment by Issuing Notes Payable Retired Notes Payable by Issuing Common Stock 2500 30100 (5000) (1300) 1300 (5000) 20200 13000 33200