E$23\mathrm{.}13($LO $2,3)($SCF$$Direct Method$)$ Brecker Inc., a greeting card company, had the following

statements prepared as of December $31,2020.$

Brecker Inc.

Comparative Balance Sheet

As of December $31,2020$ and $2019$

$12/31/2012/31/19$

Cash $ $6,000$ $ $7,000$

Accounts receivable $62,00051,000$

Short$-$term debt investments $($available$-$for$-$sale$)35,00018,000$

Inventory $40,00060,000$

Prepaid rent $5,0004,000$

Equipment $154,000130,000$

Accumulated depreciation$$equipment $(35,000)(25,000)$

Copyrights $46,00050,000$

Total assets $$313,000$ $$295,000$

Accounts payable $ $46,000$ $ $40,000$

Income taxes payable $4,0006,000$

Salaries and wages payable $8,0004,000$

Short$-$term loans payable $8,00010,000$

Long$-$term loans payable $60,00069,000$

Common stock, $$10$ par $100,000100,000$

Contributed capital, common stock $30,00030,000$

Retained earnings $57,00036,000$

Total liabilities and stockholders$$ equity $$313,000$ $$295,000$

Brecker Inc.

Income Statement

For the Year Ending December $31,2020$

Sales revenue $$338,150$

Cost of goods sold $175,000$

Gross profit $163,150$

Operating expenses $120,000$

Operating income $43,150$

Interest expense $$11,400$

Gain on sale of equipment $2,0009,400$

Income before tax $33,750$

Income tax expense $6,750$

Net income $ $27,000$

Additional information:

$1.$ Dividends in the amount of $$6,000$ were declared and paid during $2020.$

$2.$ Depreciation expense and amortization expense are included in operating expenses.

$3.$ No unrealized gains or losses have occurred on the investments during the year.

$4.$ Equipment that had a cost of $$20,000$ and was $70\%$ depreciated was sold during $2020.$

Instructions

Prepare a statement of cash flows using the direct method. $($Do not prepare a reconciliation schedule.$)$

E$23\mathrm{.}14($LO $2)($SCF$$Indirect Method$)$ Data for Brecker Inc. are presented in E$23\mathrm{.}13.$