PROBLEM SOLVING 2 The profit or loss section of the statement of comprehensive income of ITS NOT OK TO BE OK Company for the year ended December 31, 2020 is reproduced below: Sales P 6,100,000 Cost of goods sold Gross profit Gain on sale of equipment Salaries expense 3,700,000 P2,400,000 100,000 -820,000 Insurance expense -380,000 Depreciation expense 220,000 Profit before interest and income tax P1,080,000 Interest expense 120,000 Profit before income tax P960,000 288,000 P672,000 Income tax expense Profit The following information is also available: Decrease in accounts receivable P120,000 Increase in inventory 280,000 160,000 Decrease in accounts payable Increase in salaries payable 100,000 180,000 Increase in prepaid insurance Decrease in interest payable Increase in income tax payable 30,000 18,000 equired: Prepare ITS OK NOT TO BE OK Company's 2020 Statement of Cash Flows using the indirect sethod.
PROBLEM SOLVING 2 The profit or loss section of the statement of comprehensive income of ITS NOT OK TO BE OK Company for the year ended December 31, 2020 is reproduced below: Sales P 6,100,000 Cost of goods sold Gross profit Gain on sale of equipment Salaries expense 3,700,000 P2,400,000 100,000 -820,000 Insurance expense -380,000 Depreciation expense 220,000 Profit before interest and income tax P1,080,000 Interest expense 120,000 Profit before income tax P960,000 288,000 P672,000 Income tax expense Profit The following information is also available: Decrease in accounts receivable P120,000 Increase in inventory 280,000 160,000 Decrease in accounts payable Increase in salaries payable 100,000 180,000 Increase in prepaid insurance Decrease in interest payable Increase in income tax payable 30,000 18,000 equired: Prepare ITS OK NOT TO BE OK Company's 2020 Statement of Cash Flows using the indirect sethod.
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter12: Fainancial Statement Analysis
Section: Chapter Questions
Problem 90PSA
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