II. Statement of Cash Flows
Park Services Company
Comparative Balance Sheets
December 31
ASSETS 2022 2021 Increase/Decrease
Current Assets
Cash P55,000 P33,000 P22,000 Inc
Accounts receivable 20,000 30,000 10,000 Dec
Inventory 15,000 30,000 5,000 Inc
Prepaid expenses 5,000 1,000 4,000 Inc
Property, plant and equipment
Land 130,000 20,000 110,000 Inc
Buildings 160,000 40,000 120,000 Inc
Acc. Depreciation - Buildings (11,000) (5,000) 6,000 Inc
Equipment 27,000 10,000 17,000 Inc
Acc. Depreciation - Equipment (3,000) (1,000) 2,000 Inc
Total P398,000 P138,000
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Liabilities and Stockholders’ Equity
Current Liabilities
Accounts payable 28,000 12,000 16,000 Inc
Income tax payable 6,000 8,000 2,000 Dec
Long-term Liabilities
Bonds payable 130,000 20,000 110,000 Inc
Stockholders’ equity
Common stock 70,000 50,000 20,000 Inc
Retained earnings 164,000 48,000 116,000 Inc
Total Liabilities and Stockholders’ Equity P398,000 P138,000
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Park Services Company
Income Statement
December 31, 2022
Service revenue P507,000
Cost of goods sold P150,000
Operating expenses (excluding depreciation) 111,000
Depreciation expense 9,000
Loss on disposal of plant assets 3,000
Interest expense 42,000
Income before income tax 192,000
Income tax expense 47,000
Net income P145,000
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Additional information for 2022:
1. Depreciation expense was comprised of P6,000 for buildings and P3,000 for equipment.
2. The company sold equipment with a book value of P7,000 (cost P8,000 less accumulated depreciation P1,000) for P4,000 cash.
3. Issued P110,000 of long-term bonds in direct exchange for land.
4. A building costing P120,000 was purchased for cash. Equipment costing P25,000 was also purchased for cash.
5. Issued common stock for P20,000 cash.
6. The company declared and paid a P29,000 cash dividend.
Required:
• Prepare Statement of Cash Flow
(You can use the Direct Method or the Indirect Method. Specify the method used, write it on the heading portion after the date).