The following are the income statement and comparative balance sheets of Clarissa Company: Clarissa Company Income Statement For the Year Ended December 31, 2018 Sales P 1,200,000 Less: Cost of Goods Sold 580.000 Gross Profit 620,000 Less: Wages and Other Operating Expenses P 240,000 Interest Expense 18,000 Depreciation Expense 20.000 278.000 Operating Income 342,000 Other Gains (Losses) Add: Gain on Retirement of Notes 24,000 Less: Loss on Sale of Equipment 36.000 (12.000) Income before taxes 330,000 Less: Income tax expense 192,300 Net Income 137.700 201A Increase (decrease) Clarissa Company Income Statement December 31, 2018 and 201A 201B Assets Current Assets Cash P 230,900 P Accounts Receivable 180,000 Inventory 252,000 Prepaid Expenses 18.000 Total Current Assets 680,900 Non-current Assets Property, Plant and Equipment 750,000 Accumulated Depreciation (180,000) Total Assets 1,250,900 P 104,200 P 120,000 210,000 12.000 446,200 126,700 60,000 42,000 6,000 630,000 (144,000) 932,200 120,000 36,000 P Liabilities Current Liabilities Accounts Payable Interest Payable Income Taxes Payable Total Current Liabilities Long-term Notes Payable Total Liabilities 105,000 P 9,000 66.000 180,000 270.000 450,000 (15,000) (3,000) 30,000 120,000 P 12,000 36.000 168,000 192.000 360,000 78,000 P Equity Ordinary Share Capital, P5 par Retained Earnings Total Equity Total Liabilities and Equity 136,000 92,700 376,000 P 424,900 800,900 1,250,900 P 240,000 332,200 572,200 932,200 P Additional information for 2018: 1. The accounts payable balances result from inventory purchases. 2. Purchased P180,000 in plant assets by issuing P180,000 of notes payable. 3. Sold equipment with a book value of P120,000 (original cost of P300,000 and accumulated depreciation of P180,000) for P84,000 cash, yielding a P36,000 loss. 4. Received P50,000 cash from issuing 3,000 ordinary shares 5. Paid P36,000 cash to retire notes with a P60,000 book value, yielding P24,000 gain. 6. Declared and paid cash dividends of P45,000. Required: 1. Prepare the statement of cash flows of Clarissa Company for the Year Ended December 31 2018 using the direct method. 2. Prepare the statement of cash flows of Clarissa Company for the Year Ended December 31 2018 using the indirect method. ||