The following financial information is available for Wang Incorporated for the 2020 fiscal year:

Statement of Financial Position

As at 31 December	2020	2019
Cash	$ 5,000	$ 20,000
Accounts receivable	270,000	180,000
FV-NI investments	190,000	230,000
Inventory	731,000	632,000
Land	330 000	410,000
Building	1,040,000	1,120,000
Accumulated depreciation, building	(470,000)	(380,000)
Machinery	1,080,000	875,000
Accumulated depreciation, machinery	(219,000)	(212,000)
Goodwill	50,000	110,000
$3,007,000	$2,985,000
Current liabilities	$ 52,000	$ 90,000
Bonds payable	1,000,000	1,000,000
Discount on bonds	(10,000)	(15,000)
Deferred income tax	24,000	66,000
Preferred shares	1,048,000	843,000
Common shares	755,000	690,000
Retained earnings	138,000	311,000
$3,007,000	$2,985,000
Statement of Earnings and Comprehensive Income
For the Year Ended 31 December 2020
Sales	$1,684,000
Cost of goods sold	1,103,000
Gross profit	581,000
Depreciation
Building	110,000
Machinery	75,000
Goodwill impairment	60,000
Interest	115,000
Other expenses	311,000
Investment loss: decrease in fair value of FV-NI investments	40,000
Gain on sale of land	(22,000)
Loss on sale of machine	27,000
716,000
Earnings (loss) before income tax	(135,000)
Income tax recovery	54,000
Earnings (loss) and comprehensive loss	$ (81,000)

Question #5 (continued)

Additional information

1. No FV-NI investments were purchased or sold. These investments are not cash equivalents.
2. A partially depreciated building was sold for an amount equal to its net book value.
3. Cash of $40,000 was received on the sale of a machine whose original cost was $135,000. Other machinery was purchased for cash.
4. Preferred shares were issued for cash on March 1, 2020. Dividends of $50,000 were paid on these shares in 2020.
5. On September 1, 2020, 25,000 common shares were purchased and retired. The shares had an average issuance price of $55,000 and were repurchased for $57,000. On November 1, 2020, 65,000 common shares were issued in exchange for machinery.

Required: 

Prepare a statement of cash flows for Wang Inc. for the year ended December 31, 2020 using the indirect method. Wang follows IFRS and has adopted the policy of classifying interest paid as operating activities and dividends paid as financing activities.

1.Prepare the operating activities section of the statement of cash flows

Prepare the investing activities section of the statement of cash flows

Prepare the financing activities section of the statement of cash flows

2. Reconcile the change in cash during 2020 (2 marks)

Question #5 (cont’d)

Include note disclosure of the non-cash transactions, if any.