Other information is as follows:

A. Trading securities purchased in 2019 at a cost of $30,000

B. Equipment with a book value of 50,000 sold during 2019 for 55,000

C. Equipment with a book value of 45,000 was damaged by natural disasters in 2019. The equipment has no insurance.

D. Amortized bond premium of 15,000 for 2019

e. Apple Company has 30% investment in Cherry Company and is recorded using equity equity method

F. Apple company receives 20,000 dividends from Cherry Company in 2019

G. Apple companies apply a 30% tax rate

H. Money orders pay to Green Bank, interest rate 15%. Interest payment due on the first day of each month

I. The interest rate on bond debt is 12%. Interest is paid every July 1 and January 1 (other information for direct methods)

A. The Company sold shares during 2019 for 70,000 cash (other information for direct methods)

What it takes:

1. Present the cash flow report using the direct method, the indirect method, and explain the differences between the two methods!

2. Explain the constraints that occur in the input of cash flow statements (minimum 3)!