The following relates to the composition of cashflows of Company P and Company Q.Other than this, both companies are similar in most aspects.Company PNet cash flows from:2022 ($)2021 ($)Company Q2022 ($) 2021 ($)Operating activities(45,000)18,000135,00063,000Investing activitiesProceeds from sale ofoperating assetsPurchase of operating assetsFinancing activities63,000(72,000)(36,000)Proceeds from borrowings27,0009,000Repayment of debts(18,000)Net cash flows45,000 27,00045,00027,000Examine the cashflows of both companies. Which is stronger financially?

Company P: Negative operating cash flows of $45,000 in 2022. Positive operating cash flows of…

Answered: The following relates to the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Free cash flow Dillin Inc. reported the following on the company’s statement of cash flows in 20Y2 and 20Y1: Line Item Description 20Y2 20Y1 Net cash flows from operating activities $520,000 $485,000 Net cash flows used for investing activities (432,000) (394,000) Net cash flows used for financing activities (42,000) (58,800) Of the net cash flows used for investing activities, 60% was used for the purchase of property, plant, and equipment. a. Determine Dillin’s free cash flow for both years.
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Prepare the Cash Flow Statement for Dell Technologies Inc. for January 29th 2021 using the Direct Method. DELL TECHNOLOGIES INC. CONSOLIDATED STATEMENTS OF INCOME (LOSS) 29TH JANUARY 2021 (in millions) Net Revenue 94,224 Cost of Net Revenue (64,807) Gross Margin 29,417 Operating Expenses: Selling, General & Admin 18,998 Depreciation Expense 5,275 Total Operating Expenses (24,273) Operating Profit 5,144 Interest Expense (1,474) Pretax Income 3,670 Income Tax Expense (165) Net Profit 3,505 DELL TECHNOLOGIES INC. CONSOLIDATED STATEMENTS OF FINANCIAL…
Reporting Net Cash Flow from Operating Activities The following information is available for Bernard Corporation for 2019: Net income $199,000 Decrease in accounts receivable 6,400 Increase in inventory 18,300 Decrease in prepaid rent 2,100 Increase in salaries payable 4,410 Decrease in income taxes payable 4,270 Increase in notes payable (due 2023) 50,000 Depreciation expense 44,700 Loss on disposal of equipment 11,000 Required: Compute the net cash flows from operating activities using the indirect method.
Preparing a Cash Flow Statement—Indirect Method Sketchers Corporation’s recent comparative balance sheet and income statement follow. Balance Sheets, December 31 2019 2020 Assets Cash and cash equivalents $12,800 $54,400 Accounts receivable (net) 16,000 28,800 Inventory 32,000 38,400 Investment, long-term 6,400 Plant assets 96,000 150,400 Accumulated depreciation (16,000) (22,400) Total assets $147,200 $249,600 Liabilities and Stockholders’ Equity Accounts payable $9,600 $16,000 Notes payable, short-term (nontrade) 12,800 9,600 Notes payable, long-term 32,000 57,600 Common stock, no-par 80,000 128,000 Retained earnings 12,800 38,400 Total liabilities andstockholders’ equity $147,200 $249,600 Income Statement,For Year Ended December 31 2020 Sales revenue $480,000 Cost of goods sold (288,000) Gross margin 192,000 Depreciation expense (6,400) Other operating expenses (104,400) Net income $83,200 Additional…
Prepare the Cash Flow Statement for the year ended 31 December 2022 using info below The information given below was extracted from the accounting records of Excellence Limited Information from the Statement of Financial Position as at 2022 R 2021 R Ordinary share capital 750 000 580 000 Retained earnings 145 000 60 000 Property, plant and equipment (see note) 475 000 410 000 Investments 248 000 220 000 12.5% Debentures 125 000 120 000 Inventory 320 000 260 000 Trade debtors 57 000 67 500 Bank ? Prepaid expenses 15 500 2 500 Trade creditors 60 000 85 000 Bank overdraft 50 000 South African Revenue Services 25 000 40 000 Extract from the Statement of Comprehensive Income for the year ended 31 December 2022 Profit before interest and tax 342 000 Depreciation on equipment 25 000 Dividends received on investment 30 000 Interest on debentures 22 500…
Using the information from below make a statement of cash flows for the year ended december 31, 2020 using the direct method.
A-5
How do I describe the cash flow pattern
Cash Flow RatiosSpencer Company reports the following amounts in its annual financial statements: Cash flow from operating activities $90,000 Capital expenditures $59,500* Cash flow from investing activities (68,000) Average current assets 136,000 Cash flow from financing activities (8,500) Average current liabilities 102,000 Net income 42,500 Total assets 255,000 * This amount is a cash outflowa. Compute Spencer's free cash flow.b. Compute Spencer's operating-cash-flow-to-current-liabilities ratio.c. Compute Spencer's operating-cash-flow-to-capital-expenditures ratio. Round ratios to two decimal points. a. Free cash flow Answer b. Operating-cash-flow-to-current-liabilities ratio Answer c. Operating-cash-flow-to-current-expenditures ratio Answer
The following are excerpts from Hamburg Company’s statement of cash flows and other financial records. From Statement of Cash Flows: Cash flows from operating activities $433,104 Cash flows from investing activities -13,381 Cash flows from financing activities -221,035 From other records: Capital expenditure costs 18,547 Cash dividend payments 12,864 Sales revenue 465,762 Total assets 446,698 Compute free cash flow.
Here are comparative balance sheets for Skysong Company. Prepare a statement of cash flows-indirect method. SKYSONG COMPANY Comparative Balance Sheets December 31 Assets 2020 2019 Cash $72,000 $22,000 Accounts receivable 86,000 77,000 Inventory 171,000 192,000 Land 72,000 101,000 Equipment 263,000 199,000 Accumulated depreciation - equipment (65,000) (32,000) Total $599,000 $559,000 Liabilities and Stockholders' Equity Accounts payable $37,000 $48,000 Bonds payable 149,000 209,000 Common stock ($1 par) 214,000 171,000 Retained earnings 199,000 131,000 Total $599,000 $559,000 Additional information: 1. Net income for 2020 was $98,000. 2. Cash dividends of $30,000 were declared and paid. 3. Bonds payable amounting to $60,000 were redeemed for cash $60,000. 4. Common stock was issued for $43,000 cash. 5. Equipment that cost $49,000 and had a book value of $28,000 was sold for $33,000 during 2020; land was sold at cost. Prepare a statement of cash flows for 2020 using the indirect method.…

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