Suppose your company sells services of $370 in exchange for $205 cash and $165 on account. Required: Prepare the journal entry to record this transaction. Identify the amount that should be reported as net cash flow from operating activities. Identify the amount that would be included in net income. Show how the indirect method would convert net income (requirement 3) to net cash flow from operating activities (requirement 2).

1. Journal Entry

Date Particulars               Debit   Credit

         Cash                        $205

         Debtors/Party A/c   $165

               To Service revenue       $370

         (Being service income recorded)  

2. Net cash Flow = $370 - $165

Net cash Flow = $205

3. Calculation of Net Income

Net Income = Service Income - Expenses

Net Income = $370 - $0

Net Income = $370

4. Computation of how the indirect method convert the net income to net cash flow from operating activities

Particulars                                                  Amount

Net Income                                                   $370

Increase in accounts receivable               ($165)

Net cash flow from operating activities   $205

the answer is risk management planning

it's actually a very difficult task, due to not many people can make 2 million dollars in 2 years. besides that, to the not-so-realistic ideas, you can create a business. it could be practically anything, but make it into a business that isn't that known yet, you get me? also, lets not forget about stock market. that's where all the good stuff happens. use investments at the beginning and begin to raise up your business or whatever you're going to do. as this is a very non-realistic idea, it's still worth the shot!