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PROBLEM 2
Cash Flows from Operating Activities-Indirect Method
Imara Andam Business Solutions had a profit of P330,000 in 2019. During the year, the entity had
depreciation expense of P70,000. Accounts receivable increased by P110,000 and accounts payable
increased by P50,000. The entity started operations in 2019 and the foregoing are the entity’s only current
assets and current liabilities.
Required:
Determine the net cash flows from operating activities using the indirect method.
PARTY CONSULTANTS
Statements of Cash Flows
For the month ended XX-XX-XXXX
The following data are taken from the records of Howa Company for the year 2009.
Cash received
From customers P 500,000
Proceeds of Bank Loan 800,000
Additional Investment of Howa 125,000
Proceeds of sale of equipment 35,000
Dividends on stock investments 5,000
Interest Income 2,300
Commissions Income 10,000
Cash paid
Operating expenses 195,000
Principal of Bank Loan 200,000
Withdrawal of Howa 40,000
Interest on bank loan 4,000
Purchase of furniture 18,000
Taxes and licenses 5,600
HOWA COMPANY
Statement of Cash Flows
For the Year Ended December 31, 2009
PROBLEM 5
The following data are taken from the records of Kiwi Pot Company for the year 2010.
PROBLEM 6
Portions of the financial statements for Myriad Products are provided below.
Year
2011 2010 Change
Cash $102 $100 $ 2
Accounts receivable 220 232 (12)
Inventory 440 450 (10)
Accounts payable 140 134 6
Salaries payable 80 86 (6)
Interest payable 25 20 5
Income taxes 15 10 5
payable
Required:
1. Prepare the cash flows from operating activities section of the statement of cash flows for Myriad
Products Company using the direct method.
2. Prepare the cash flows from operating activities section of the statement of cash flows for Myriad
Products Company using the indirect method.