Question

Given the following information, prepare a statement of cash flows. Cashflow from operating activities: Investment Activities DATA Increase in accounts receivable 30 Increase in inventories 30 Operating Income 95 Interest Expense 30 Increase in accounts payable 25 Dividends 15 Increase in common stock 20 Increase in net fixed assets 23 Depreciation Expense 12 Income taxes 17 Beginning cash 20
Assume all amounts are in 000's

Answer 1

	Cash Flow from operating Activities	Amount $	Amount $
	Operating Income	95,000
	Less Interest Expense	(30,000)
	EBT	65,000
	Less Income Taxes	(17,000)
	Net Income	48,000	48,000
	Adjustments
	Add Depreciation	12,000
	Less Increase in Accounts Receivable	(30,000)
	Less Increase in Inventory	(30,000)
	Add : Increase in Accounts Payable	25,000
	Total Adjustments	(23,000)	(23,000)
a	Cash flow from Operating Activities		25,000
	Cash flow from Investing Activities
	Cash outflow in Fixed asset Increase	(23,000)
b	Cash outflow from Investing Activities		(23,000)
	Cash flow from Financing Activities
	Cash receipt from common stock issues	20,000
	Less: Dividends paid	(15,000)
c.	Net Cash inflow from Financing Activities		5,000
d	Net Cash flow from Operating, Investing & Financing Activities		7,000
	Opening Cash Balance		20,000
	Closing Cash Balance		27,000