a. Explanation Indirect Method: This method is easy as it starts with net profit and makes necessary adjustment by converting accrual basis into cash basis. Firm make adjustment by adding back all the non cash expenses like depreciation , provision for losses on accounts receivable and similarly reduce non cash revenues and gains from the net profit. Computation of cash flow from operating activities under indirect method: Cash flow from operating activities For the year ended 31 December Particulars Amounts($) Net income 839 b. To determine Cash flow from operating activities of AFI under direct method.

Intermediate Accounting Plus Mylab Accounting With Pearson Etext -- Access Card Package (2nd Edition)

2nd Edition

ISBN: 9780134833101

Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella

Publisher: PEARSON

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Chapter 22, Problem 22.3E

To determine

Cash flow from operating activities of AFI under indirect method.

To determine

Cash flow from operating activities of AFI under direct method.

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Chapter 22, Problem 22.2E

Chapter 22, Problem 22.4E

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Chapter 22 Solutions

Intermediate Accounting Plus Mylab Accounting With Pearson Etext -- Access Card Package (2nd Edition)

Ch. 22 - Prob. 22.1Q Ch. 22 - Prob. 22.2Q Ch. 22 - Prob. 22.3Q Ch. 22 - Prob. 22.4Q Ch. 22 - Prob. 22.5Q Ch. 22 - How do firms reclassify gains and losses on the...Ch. 22 - Prob. 22.7Q Ch. 22 - Prob. 22.8Q Ch. 22 - Prob. 22.9Q Ch. 22 - Prob. 22.10Q

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Cash flow from operating activities of AFI under indirect method.

Solution Summary: The author concludes that the net cash used in operating activities of AFI under indirect method is 939.

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Cash flow from operating activities of AFI under indirect method.

Cash flow from operating activities of AFI under direct method.

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