Required: Prepare a statement of cash flows using direct and indirect method.

Note: Using excel would be appreciated for clearer presentation.

Problem 17-3 (AICPA Adapted) Sandy Company reported the following comparative statement of financial position at year-end: Assets 2019 2018 Cash and cash equivalents Accounts receivable 120,000 150,000 370,000 210,000 Inventory 1,090,000 860,000 Prepaid insurance 80,000 90,000 Property, plant and equipment 4,300,000 3,620,000 Accumulated depreciation 840,000) 720,000) 5,120,000 4,210,000 Liabilities and Equity Accounts payable 400,000 345,000 Salaries payable 70,000 40,000 Income tax payable 35,000 15,000 Accrued interest payable 5,00041 29 Bonds payable 600,000 Share capital 3,050,000 3,050,000 Retained earnings 1, 100,000 760,000 Treasury shares BOU( 140,000) CS Scanned with CamScanner, Qui 5,120,000 4,210,00The income statement for the year ended December 31, 201, showed the following: 4,450,000 Sales Cost of goods sold: 860,000 Inventory - January 1 2,630,000 Purchases 3,490,000 Goods available for sale Inventory - December 31 (1,090,000) 2,400,000 Gross income 2,050,000 Gain on sale of equipment 60,000 Total income 2,110,000 Expenses: Salaries 640,000 Insurance 1'00,000 Rent 350,000 Depreciation 260,000 Bad debt writeoff 20,000 Interest expense 40,000 1,410,000 Income before tax 700,000 Income tax 200,000 Net income 500,000 Additional information 1. Cash dividends of P160,000 were declared and paid during the year. 2. Equipment costing P190,000 and with accumulated depreciation of P140,000 was sold for P110,000 cash. 3. New equipment was purchased for cash. 4. Bonds payable were issued for cash at the face value of P600,000. 5. The treasury shares were purchased at cost of P140,000. Required: a. Prepare a statement of cash flows using the direct method. b. Compute the cash flow from operating activities using the indirect method. CS canned with CamSeanng