UNIVERSITY OF CALOOCAN CITY
College of Business and Accountancy
INTERMEDIATE ACCOUNTING 3
Problem Solving – Statement of Cash Flows
Problem 1: The movements of cash account of ABC Co. during 2021 are shown below:
Cash
Beginning
100
1,900
Purchases
Sales
3,000
600
Operating expenses
Interest income
10
15
Interest expense
Rent income
135
35
Income taxes
Dividend income
20
50
Investment in FVOCI
Sale of held for trading securities
400
550
Purchase of equipment
Sale of old building
260
65
Loan granted to employee
Collection of non-trade note
30
120
Payment of loan borrowed
Proceeds from loan with a bank
800
100
Reacquisition of shares
Issuance of notes
485
45
Dividends
1,760
Ending
Problem 2: DEF Co. had the following information during 2021:
Accounts receivable, Jan. 1, 2021
600
Accounts receivable, Dec. 31, 2021
400
Sale on account and cash sales
8,000
Bad debts expense
200
Accounts payable, Jan. 1, 2021
350
Accounts payable, Dec. 31, 2021
200
Cost of sales
Increase in inventory
Operating expenses on accrual basis
4,000
900
1,220
Increase in accrued payables for operating expenses
410
Decrease in prepaid operating expenses
390
PPE, Jan. 1, 2021
1,800
PPE, Dec. 31, 2021
2,700
Additional information:

There were no write-offs of accounts receivable during the year.

Equipment with an accumulated depreciation of P200 was sold during the year for P120 resulting to a gain on sale
of P15.
Requirements: Compute the following:
a. Cash receipts from customers
b. Cash payments to suppliers
c. Cash payments for operating expenses
d. Cash payments for the acquisition of PPE
Problem 3: An entity presented the following comparative financial information:
2022
Property, plant and equipment
Accumulated depreciation
Long-term investments
Prepaid expenses
Merchandise inventory
Accounts receivable, net of allowance
Cash
Share capital-ordinary
Retained earnings
Long-term note payable
Accounts payable
Dividend payable
Accrued expenses
2,190,000
450,000
225,000
351,000
1,950,000
1,560,000
690,000
3,000,000
906,000
1,275,000
309,000
201,000
825,000
2022
Net credit sales
Cost of goods sold
Gross profit
Expenses, including income tax
Net income
7,020,000
(3,915,000)
3,105,000
(2,586,000)
519,000
2021
1,440,000
270,000
315,000
1,260,000
1,080,000
640,000
2,400,000
688,000
1,095,000
282,000
2021
3,753,000
(1,881,000)
1,872,000
(1,374,000)
498,000
Accounts receivable and accounts payable relate to merchandise for sale in the normal course of business. The allowance
for bad debts was the same at the end of 2022 and 2021 and no receivables were charged against the allowance.
Accounts payable are recorded net of any discount and are always paid within the discount period.
The proceeds from the note payable were used to finance the acquisition of property, plant and equipment. Ordinary shares
were sold to provide additional working capital.
1. What amount should be reported as net cash provided by operating activities in 2022?
2. What amount should be reported as net cash used in investing activities in 2022?
3. What amount should be reported as net cash provided by financing activities in 2022?