Question 1.1 Calculate the cash balance as at the beginning of the year and state whether the balance is favorable or unfavorable
Question 1.1 Calculate the cash balance as at the beginning of the year and state whether the balance is favorable or unfavorable
Chapter14: Security Structures And Determining Enterprise Values
Section: Chapter Questions
Problem 8EP
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Question 1.1
Calculate the cash balance as at the beginning of the year and state whether the balance is favorable or unfavorable
![cial M X
O OSA Jan21_PGDBM_AFM801_Ma X
A Jan21 PGDBM_AFM801_Main_20211112080701%20(1).pdf
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INFORMATION
MUSTANG LIMITED
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2020
Cash flows from operating activities
292 000
Profit before interest and tax/Operating profit
512 000
Depreciation
128 000
640 000
Profit before working capital changes
Working capital changes
(100 000)
8 000
Decrease in inventory
Increase in receivables
(76 000)
Decrease in payables
(32 000)
08:33
22°C Rain
ENG
2021/11/23
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Transcribed Image Text:cial M X
O OSA Jan21_PGDBM_AFM801_Ma X
A Jan21 PGDBM_AFM801_Main_20211112080701%20(1).pdf
1).pdf
2 / 12
100% +
INFORMATION
MUSTANG LIMITED
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2020
Cash flows from operating activities
292 000
Profit before interest and tax/Operating profit
512 000
Depreciation
128 000
640 000
Profit before working capital changes
Working capital changes
(100 000)
8 000
Decrease in inventory
Increase in receivables
(76 000)
Decrease in payables
(32 000)
08:33
22°C Rain
ENG
2021/11/23
PrtScr
Insert
Home
End
Delet
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&
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)
Backs
5 €
7
8
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OSA Jan21 PGDBM_AFM801_Ma X +
A Jan21 PGDBM_AFM801_Main_20211112080701%20(1).pdf
(1).pdf
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100%
-
Decrease in payables
(32 000)
Cash generated from operations
540 000
Interest paid
?
Dividends paid
(120 000)
Income tax paid
(96 000)
Cash flows from investing activities
(448 000)
(328 000)
Non-current assets purchased
Increase in investments
(120 000)
Cash flows from financing activities
160 000
Increase in long-term borrowings
160 000
Net increase in cash and cash equivalents
4 000
Cash and cash equivalents at beginning of the year
08:37
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ENG
2021/11/23
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9](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F54b8b6c7-b405-4454-bb2b-0c91f06fd4db%2Fcc51a5a8-f522-4315-9055-40f3be37648f%2Fbbpzs5q_processed.jpeg&w=3840&q=75)
Transcribed Image Text:ncial M X
OSA Jan21 PGDBM_AFM801_Ma X +
A Jan21 PGDBM_AFM801_Main_20211112080701%20(1).pdf
(1).pdf
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3 / 12
100%
-
Decrease in payables
(32 000)
Cash generated from operations
540 000
Interest paid
?
Dividends paid
(120 000)
Income tax paid
(96 000)
Cash flows from investing activities
(448 000)
(328 000)
Non-current assets purchased
Increase in investments
(120 000)
Cash flows from financing activities
160 000
Increase in long-term borrowings
160 000
Net increase in cash and cash equivalents
4 000
Cash and cash equivalents at beginning of the year
08:37
22°C
ENG
2021/11/23
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Insert
Home
End
Delete
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FZ
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5 €
7
8
9
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