Instant Brake Inc.’s comparative balance sheet information at December 31, 2023 and 2022, and its income statement for the year ended December 31, 2023, are as follows:

Instant Brake Inc.
Income Statement
December 31, 2023
Sales				$	883,000
Cost of goods sold					569,000
Gross profit				$	314,000
Operating expenses	$	132,650
Depreciation expense		41,210			173,860
Operating Profit					140,140
Loss on sale of equipment		13,230
Investment income		20,020
Profit before taxes					146,930
Income taxes					19,000
Profit				$	127,930

Instant Brake Inc.
Balance Sheet Information
	December 31
	2023			2022			Net Change
Cash	$	41,000		$	23,560		$	17,440
Cash equivalents		25,780			8,200			17,580
Accounts receivable		86,920			30,440			56,480
Inventory		112,840			76,520			36,320
Investment		0			25,780			(25,780	)
Land		75,400			75,400			0
Building and equipment		415,110			435,130			(20,020	)
Accumulated depreciation		111,050			89,960			21,090
Accounts payable		10,680			36,400			(25,720	)
Dividends payable		2,200			1,300			900
Bonds payable		17,000			0			17,000
Preferred shares		80,200			80,200			0
Common shares		404,680			404,680			0
Retained earnings		131,240			62,490			68,750

During 2023, the following transactions occurred:

Purchased equipment for $20,900 cash.

Sold the investment on January 1, 2023, for $45,800, resulting in investment income of $20,020.

Sold equipment for $7,570 cash that had originally cost $40,920 and had $20,120 of accumulated depreciation.

Issued $17,000 of bonds payable at face value.

 

Required:
1. How much cash was paid in dividends?
2. Prepare a statement of cash flows for Instant Brake for the year ended December 31, 2023, using the indirect method.