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$ 928, 600 556, 200 $ 372.400 Tor Tear onded Vecember Sales Cost of goods sold Gross profit Operating expenses: Depreciation expense Other expenses Total operating expenses Profit from operations Income taxes Profit $ 25, 200 232, 800 258,000 3 114, 400 18,600 3 95, 800 LAG Network Inc. Comparative Balance Sheet Information December 31 Assets 2020 2019 Cash $ 81, 190 $ 54.400 Accounts receivable 42, 400 37,600 Merchandise inventory 284, 710 247, 800 Equipment 154,400 138,400 Accumulated depreciation (21,800 146.600) Total assets $ 490,900 $ 431,600 Liabilities and Equity Accounts payable $ 31, 200 3 43,800 Income taxes payable 11,600 10.200 Common shares 363,000 337,500 Retained earnings 85, 100 40, 100 Total liabilities and equity $ 490, 900 3431.600 Accounts payable Income taxes payable Common shares Retained earnings Total liabilities and equity 31, 200 11,600 363,000 85, 100 $ 490, 900 $ 43, 800 10, 200 337,500 40, 100 $ 431,600 Additional information regarding LAG Network Inc.'s activities during 2020: a. Equipment is purchased for $16,000 cash. b. 10,200 common shares are issued for cash at $2.50 per share. c. Declared and paid $50,800 of cash dividends during the year. Other information regarding LAG Network Inc.: a. All sales are credit sales. b. All credits to accounts receivable are receipts from customers. c. All purchases of merchandise are on credit. d. All debits to accounts payable result from payments for merchandise. e. Other operating expenses are cash expenses. f. The only decrease in income taxes payable is for payment of taxes. Required: Prenare a statement of cash flows for 2020 using the direct method to report cash inflo lo accounts payable result from payments for merchandise. e. Other operating expenses are cash expenses. f. The only decrease in income taxes payable is for payment of taxes. Required: Prepare a statement of cash flows for 2020 using the direct method to report cash inflows a any deduction in cash and cash outflows as negative amounts.) x Answer is complete but not entirely correct. LAG NETWORK INC. Statement of Cash Flows For Year Ended December 31, 2020 Cash flows from operating activities: Cash received from customers 4,800 X Cash paid for other operating expenses (232,800) Cash paid for merchandise inventory 15,000 X Cash paid for income taxes 1,400 $ (211,600) Net cash inflow from operating activities Cash flows from investing activities: Cash paid for equipment (16,000)
