Cash Western Environmental Inc. Comparative Balance Sheet Information June 30 2020 2019 $ 92,960 $ 55,400 Accounts receivable (net) 106,000 76,400 Inventory 80,260 116,260 Prepaid expenses 6,580 6, 340 Equipment 166,000 154,000 Accumulated depreciation 35,600 22,000 Accounts payable 33,200 40,400 Wages payable 10,400 Income taxes payable 2,980 4,420 Notes payable (long-term) 58,000 94,000 Common shares 286,000 226,000 Retained earnings 25, 620 380 21,200 $796,000 480,800 $315,200 Western Environmental Inc. Income Statement For Year Ended June 30, 2020 Sales Cost of goods sold Gross profit Operating expenses: Depreciation expense $70, 420 Other expenses 80,500 Total operati expenses Profit from operations Gain on sale of equipment Profit before taxes Income taxes Profit 150, 920 $164, 280 4,400 $168, 680 64, 280 $104,400 Required: Use the Western Environmental Inc. information given below to prepare a statement of cash flows for the year ended June 30, 2020, using the indirect method. (List any deduction in cash and cash outflows as negative amounts.) a. A note is retired at carrying value. b. The only changes affecting retained earnings during 2020 are profit and cash dividends paid. c. New equipment is acquired during 2020 for $76,420. d. The profit on sale of equipment costing $64,420 during 2020 is $4,400. e. Prepaid expenses and wages expense affect other expenses on the income statement. f. All sales and purchases of merchandise were on credit. WESTERN ENVIRONMENTAL INC. Statement of Cash Flows For Year Ended June 30, 2020 Cash flows from operating activities: Adjustments to reconcile profit to net cash provided by operating activities: Cash flows from investing activities: Cash flows from financing activities