Homework answers / question archive / Preparing the statement of cash flows (indirect method) LO5, 6 CHECK FIGURE: Net cash outflows from investing activities = $160 (thousand) Paddleboard Inc

Preparing the statement of cash flows (indirect method) LO5, 6 CHECK FIGURE: Net cash outflows from investing activities = $160 (thousand) Paddleboard Inc

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Preparing the statement of cash flows (indirect method) LO5, 6 CHECK FIGURE: Net cash outflows from investing activities = $160 (thousand) Paddleboard Inc. began operations on January 1, 2019. Its post-closing trial balance at December 31, 2019 and 2020, is shown below along with some other information. Paddleboard Inc. Income Statement For Year Ended December 31, 2020 (000s) Paddleboard Inc. Post-Closing Trial Balance (000s) 3,784 1,536 2,248 Revenues: Sales....... Cost of goods sold Gross profit. Expenses: Other expenses... Depreciation expense.. Total operating expenses. Profit from operations. Income tax expense. Profit ...... 880 80 Account Cash......... Receivables Merchandise inventory... Property, plant, and equipment.. Accumulated depreciation Investments Accounts payable Accrued liabilities... Bonds payable.... Common shares Retained earnings December 31 2020 2019 $2,880 $1,840 2,800 2,080 2,560 3,040 3,040 2,720 1,920 1,840 2,080 2,240 1,920 1,440 320 480 2,240 2,400 3,040 2,720 3,920 3,040 960 1,288 288 1,000 Other information regarding Paddleboard Inc. and its activities during 2020: 1. Assume all accounts have normal balances. 2. Cash dividends were declared and paid during the year. 3. There were no sales of property, plant, and equipment assets during the year. 4. Investments were sold for cash at their original cost. Required Using the information provided, prepare a statement of cash flows (applying the indirect method) for the year ended December 31, 2020. Analysis Component: a. Paddleboard Inc. experienced an increase in cash during 2020. Does this necessarily represent a favourable situation? Explain why or why not. b. Explain the causes of change in Paddleboard Inc.'s cash situation during 2020.