Regal Global Industries, Inc. is a multinational conglomerate that is both a manufacturer and distributor of various products and services in several industries. Regal provides products and services to both the retail consumer markets, as well as to the business to business sector, under several different brand names through a multitude of subsidiaries. Regal also operates a financial services division to facilitate financing and leasing of some of its commercial equipment products. Regal is headquartered in Los Angeles, CA, and is a publicly traded company, listed on the NYSE. Regal has manufacturing and distribution facilities throughout the US, Asia, and Latin America. Regal sells its various product lines domestically and internationally, in all major industrialized markets.

You are a newly hired Senior Staff Accounting assigned to the international accounting team in the Los Angeles corporate headquarters. You report to Barry Burton, European Segment Accounting Manager, who is a direct report to Steve Fox, Controller for international operations. Steve is a direct report in the Clark Green, corporate chief financial officer.

The European Business Segment is a mirror of the overall corporate footprint and provides products and services in all of Regals lines of business. The European Business Segment maintains accounting records locally following IFRS, as well as the other local accounting requirements. The European Business Segment consolidates into the Corporate Parent, which is a US corporation, following US GAAP.

Q: You completed your first assignment and turned it in to Barry. Next, Barry asks you to prepare a Cash Flow Statement for Weyland, under the Direct Method. Barry explains to you, that for the purposes of the cash flow statement, under the direct method, you are required to compute the cash collections from customers, payments to suppliers, and cash paid for operating expenses. He provides you with the following baseline information.

Net credit sales 5,000,000

AR, end of the year 1,500,000

AR, beginning of the year 2,500,000

Purchases (on account) 4,000,000

Trade payable, end of the year 1,900,000

Trade Payable, beginning of the year 2,000,000

Operating expenses 3,000,000

Accrued expenses, beginning of the year 500,000

Accrued expenses, end of the year 400,000

Depreciation on property, plant, and equipment 600,000