Whiskey Industries Ltd., a Nanaimo, British Columbia-based company, has a December 31 year end. The company's comparative statement of financial position and its statement of income for the most recent fiscal year are presented here, along with some additional information: 1. 2. During the year, Whiskey Industries sold, for $370 cash, equipment that had an original cost of $740 and a net carrying amount of $150. Whiskey Industries borrowed an additional $5,920 by issuing notes payable in 2020. During the year, the company purchased a piece of land for a future manufacturing site for $148,000. The land was purchased with no money down and the company entered into a mortgage payable for the full amount. 3. As at December 31, 2020 2020 2019 Assets Current assets Cash $4,480 $14,430 14,800 7,400 440 370 Accounts receivable Prepaid rent Inventory Total current assets Manufacturing equipment Accumulated depreciation, manufacturing equipment Land 29,600 22,200 41,920 51,800 117,660 74,000 (51,210 ) (37,000 ) 148,000 0 $256,370 $88,800 Total assets $8,140 440 $4,440 300 350 220 Liabilities and shareholders' equity Current liabilities Accounts payable Wages payable Dividends payable Total current liabilities Mortgage payable Notes payable Common shares Retained earnings Total liabilities and shareholders' equity 8,930 4,960 148,000 0 34,040 29,600 21,460 18,500 43,940 35,740 $256,370 $88,800 WHISKEY INDUSTRIES LTD. Statement of Income For the year ended December 31, 2020 Sales $96,200 Cost of goods sold 59,200 Gross margin 37,000 Expenses Rent expense 5,250 Wages expense 7,100 Depreciation expense 14,800 Interest expense 440 Income tax expense 380 Gain on sale of equipment (220) Net income $9,250 Using the information above, prepare the statement of cash flows for Whiskey Industries Ltd. for the year ended December 31, 2020, using the indirect method. (Show amounts that decrease cash flow with either a-sign e.g. -15,000 or in parenthesis e.g. (15,000).) WHISKEY INDUSTRIES LTD Statement of Cash Flows, Indirect Method For the Year Ended December 31, 2020 Cash Flows from Operating Activities Net Income $ Depreciation Expense Gain on Sale of Equipment Decrease in Accounts Receivable Increase in Inventory Increase in Prepaid Rent $ S 8 S S Supplementary disclosures: Cash paid for interest $ Cash paid for income tax $ Non-cash investing and financing activities: During the year, land with a value of $ was acquired by signing a mortgage payable for the full amount. e Textbook and Media Question Part Score --/85 Determine the cash flows from operating activities using the direct method. (Show amounts that decrease cash flow with either a - sign e.g.-15,000 or in parenthesis e.g. (15,000).) WHISKEY INDUSTRIES LTD. Statement of Cash Flows, Direct Method For the Year Ended December 31, 2020 $
