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QUESTION 4(15 marks): Musguedoboit Bakery Ltd. (MBL) produces bakery products, including its world famous "classic baguettes." It ships its products to customers throughout North America. The balance sheet totals for December 31, 2020 and 2021 are recorded. (Do not mix up the years.) Assets 2020 2021 $ 7,000 400 600 8,000 $1,000 1,500 500 3,000 Current assets Cash Accounts receivable Inventory Total current assets Non-current asset Equipment Less:Accumulated depreciation Land Patent (Intangible) Total non-current assets Total assets Liabilities Current liabilities Accounts payable Non-current liabilities Note payable Total liabilities Shareholders' equity Common shares Retained earnings Total shareholders' equity Total liab and s/equity $ 7,000 (2,400) 0 400 $ 5,000 $ 13,000 $ 6,500 (2,000) 500 0 $ 5,000 $ 8,000 $ 2,000 $1,000 2,000 4,000 0 1,000 1,000 8,000 9,000 $ 13,000 1,000 6,000 7,000 $ 8,000 Other information follows: 1. Net income for the year: $ 2,020. 2. Dividends issued and paid in the year: $20 3. Land was sold in the year for $ 5,500 cash. MBL took advantage of the seller's market and disposed of all the land they owned. 4. Equipment was purchased in the year, as well as a patent (intangible asset). No equipment was sold in the year, Required: a 1. Prepare in good form a cash flow statement (using the indirect method) for 2021. (Do not get the years 'mixed up 2. Assume that you are the accountant/controller of MBL. The Chief Executive Officer of the company e-mails you and writes, We need to celebrate! What a great year! I looked " at our bank statement and our cash has gone way up! Also, I noticed that we made $2,020 in the year, a big increase from the prior year. Get out the champagne!" Should you feel as excited as the CEO? Why or why not? Prepare brief notes to use when you discuss your findings with the CEO

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