Question

Portions of the financial statements for Myriad Products are provided below. MYRIAD PRODUCTS COMPANY Income Statement For the Year Ended December 31, 2021 ($ in millions) Sales $ 880 Cost of goods sold 308 Gross margin 572 Salaries expense $ 145 Depreciation expense 96 Amortization expense 5 Interest expense 36 Loss on sale of land 4 286 Income before taxes 286 Income tax expense 143 Net Income $ 143 MYRIAD PRODUCTS COMPANY Selected Accounts from Comparative Balance Sheets December 31, 2021 and 2020 ($ in millions) Year 2021 2020 Change Cash $ 135 $ 128 $ 7 Accounts receivable 259 274 (15 ) Inventory 464 478 (14 ) Accounts payable 198 190 8 Salaries payable 106 114 (8 ) Interest payable 54 48 6 Income tax payable 45 38 7 Required: Prepare the cash flows from the operating activities section of the statement of cash flows for Myriad Products Company using the indirect method. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Amounts to be deducted should be indicated with a minus sign.)

Answer 1

Answer-

MYRIAD PRODUCTS
STATEMENT OF CASH FLOWS PARTIAL (USING INDIRECT METHOD)
FOR THE YEAR ENDED DECEMBER 31,2021
Particulars		Amount
		$
Cash flow from operating activities
Net Income		143
Adjustments to reconcile net income to net cash provided by operating activities
Adjustment for non cash effects
Depreciation expenses		96
Amortization expense		5
Loss on sale of land		4
Change in operating assets & liabilities
Decrease in accounts receivable		15
Decrease in inventory		14
Increase in income tax payable		7
Increase in accounts payable		8
Decrease in salaries payable		-8
Incresae in interest payable		6
Net cash flow from operating activities (a)		290