CASH FLOW EXERCISE Balance sheet, income statement and cash flow. The Statement of financial position of...

 

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CASH FLOW EXERCISE Balance sheet, income statement and cash flow. The Statement of financial position of YYY for 2018 is the following: Assets Equity Non-current assets 160 Equipment 200 (Accumulated depreciation) (40) Current assets 220 Inventory 50 Accounts receivable 100 Prepaid insurance expenses 20 Cash 50 Total assets 380 ASSETS Non-current assets 350 PPE Current assets 400 (Accumulated depreciation) -50 Shareholders' capital Retained Earnings Total equity BALANCE SHEET 2019 Liabilities Accounts Payable Taxes payables Bank loan Total Liabilities Total Equity + Liabilities EQUITY Share capital 100 Retained earnings 90 Total Equity 190 LIABILITIES 100 50 150 60 60 110 230 380 320 Inventory Account receivables Cash Total Assets 40 200 80 INCOME STATEMENT 2019 670 Account payables 310 Bank loan Salaries payables Taxes payables 20 Deferred revenues 100 (unearned revenues) Liabilities 480 Total Equity + liabilities 20 30 670 Revenues -COGS (Purchases - Change in inventory = 300 - (-10)) = Gross margin -Salaries expenses -Depreciation expenses -Interest expenses -Insurance expenses =NET INCOME ELABORATE THE CASH FLOW STATEMENT USING THE INDIRECT METHOD. 500 -310 190 -80 -10 -10 -20 70 CASH FLOW EXERCISE Balance sheet, income statement and cash flow. The Statement of financial position of YYY for 2018 is the following: Assets Equity Non-current assets 160 Equipment 200 (Accumulated depreciation) (40) Current assets 220 Inventory 50 Accounts receivable 100 Prepaid insurance expenses 20 Cash 50 Total assets 380 ASSETS Non-current assets 350 PPE Current assets 400 (Accumulated depreciation) -50 Shareholders' capital Retained Earnings Total equity BALANCE SHEET 2019 Liabilities Accounts Payable Taxes payables Bank loan Total Liabilities Total Equity + Liabilities EQUITY Share capital 100 Retained earnings 90 Total Equity 190 LIABILITIES 100 50 150 60 60 110 230 380 320 Inventory Account receivables Cash Total Assets 40 200 80 INCOME STATEMENT 2019 670 Account payables 310 Bank loan Salaries payables Taxes payables 20 Deferred revenues 100 (unearned revenues) Liabilities 480 Total Equity + liabilities 20 30 670 Revenues -COGS (Purchases - Change in inventory = 300 - (-10)) = Gross margin -Salaries expenses -Depreciation expenses -Interest expenses -Insurance expenses =NET INCOME ELABORATE THE CASH FLOW STATEMENT USING THE INDIRECT METHOD. 500 -310 190 -80 -10 -10 -20 70

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To create the cash flow statement using the indirect method we begin with the net income and adjust for changes in the balance sheet accounts to convert the income statement from an accrual basis to a ... View the full answer