Q2-3: Calculating Total cash flows NMB Company shows the following information on its 2020 income statement; Sales = $50,000; costs = $30,000; other expenses = $2,500; depreciation expense = $2,500; interest expense = $5,000; tax paid = $3,400; dividends paid = $3,200. In addition, you are told that the firm issued $500 in new equity during 2020, and repaid $1,000 in outstanding long-term debt. 1. What is the cash flow from operation? 2. What is the cash flow to creditors? 3. What is the cash flow to stockholders? 4. If net fixed assets increased by $2,900 during the year, what were the addition to MNB?

Q2-3: Calculating Total cash flows NMB Company shows the following information on its 2020 income statement; Sales = $50,000; costs = $30,000; other expenses = $2,500; depreciation expense = $2,500; interest expense = $5,000; tax paid = $3,400; dividends paid = $3,200. In addition, you are told that the firm issued $500 in new equity during 2020, and repaid $1,000 in outstanding long-term debt. 1. What is the cash flow from operation? 2. What is the cash flow to creditors? 3. What is the cash flow to stockholders? 4. If net fixed assets increased by $2,900 during the year, what were the addition to MNB?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Concept explainers

Cash Flow Statement Analysis

A company's cash flow is the movement of its cash inflows and cash outflows. A cash flow statement is prepared to determine changes in an organization's cash position. A cash flow statement shows how much money was generated and spent on the business during the fiscal year. The cash flow analysis is a method of analyzing an organization's investing, financing, and operating activities. A cash flow statement reveals an organization's liquidity and solvency, as well as its ability to change cash flows in the future. It eliminates the other effects of accounting methods by improving the comparability of different organizations' operational performance.

Question

Q2-3: Calculating Total cash flows
NMB Company shows the following information on its 2020 income statement; Sales = $50,000; costs = $30,000; other expenses = $2,500; depreciation
expense = $2,500; interest expense = $5,000; tax paid = $3,400; dividends paid = $3,200. In addition, you are told that the firm issued $500 in new equity
during 2020, and repaid $1,000 in outstanding long-term debt.
1. What is the cash flow from operation?
2. What is the cash flow to creditors?
3. What is the cash flow to stockholders?
4. If net fixed assets increased by $2,900 during the year, what were the addition to MNB?

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Prepare a statement of cash flows using the information provided below and amounts indicated on the attached template. CD Corporation has the following for 2020: Net Income $145,000 Depreciation was $4,250 Sold Equipment with a Cost of $32,000, Accumulated Depreciation $15,000 for $22,500 Cash. Sold Common Stock of $250,000 Paid a Dividend of $6,500 Balance Sheet Balances 2020 2019 Cash 882,500 425,000 Accounts Receivable 575,500 275,500 Merchandise Inventory 445,000 900,000 Prepaid Expenses 67,500 82,500 Equipment 68,000 100,000 Accumulated Depreciation – Building (29,250) (40,000) Accounts Payable 590,100 737,350 Wages Payable 65,000 40,000 Retained Earnings 254,150 115,650 Common Stock 1,100,000 850,000
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Consider the following balance sheets and income statement for Cruyff Enterprises. Cruyff paid $25,000 for rent in 2020. Compute the cash that Cruyff paid for dividends. Cruyff Enterprises Balance Sheets As of December 31, 2020 and 2019 2020 2019 Assets: Cash $18,650 $ 14,900 Accounts Receivable 42,000 36,000 Inventory 60,500 50,000 Prepaid Rent 3,000 1,400 Property, Plant and Equipment 230,000 205,600 Less: Accumulated Depreciation (75,000) (65,000) Total Assets $279,150 $242,900 Liabilities and Stockholders’ Equity: Accounts Payable $26,500 $21,000 Interest Payable 650 400 Unearned Revenue 7,000 10,000 Bonds Payable 37,000 37,000 Common Stock 20,000 15,000 Additional Paid-In Capital 48,000 40,000 Retained Earnings 140,000 119,500…
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