Question

Problem 3-5

Axtel Company has the following financial statements.

Axtel Company
Balance Sheet
For the period ended 12/31/X1 ($000)
				ASSETS
		12/31/X0			12/31/X1
Cash		$	3,496		$	2,906
Accounts receivable			6,851			5,513
Inventory			2,573			3,220
CURRENT ASSETS		$	12,920		$	11,639
Fixed assets
Gross		$	22,478		$	24,360
Accumulated deprec.			(12,238)			(13,274)
Net		$	10,240		$	11,086
TOTAL ASSETS		$	23,160		$	22,725
				LIABILITIES
Accounts payable		$	1,566		$	1,689
Accruals			206			384
CURRENT LIABILITIES		$	1,772		$	2,073
Long-term debt		$	7,112		$	6,002
Equity			14,276			14,650
TOTAL CAPITAL		$	21,388		$	20,652
TOTAL LIABILITIES AND EQUITY		$	23,160		$	22,725

Axtel Company
Income Statement
For the period ended 12/31/X1
($000)
Sales		$	36,212
COGS			20,238
Gross margin		$	15,974
Expense		$	10,555
EBIT		$	5,419
Interest			713
EBT		$	4,706
Tax			1,605
Net income		$	3,101

In addition, Axtel retired stock for $1,000,000 and paid a dividend of $1,727,000. Depreciation for the year was $1,036,000. Construct a statement of cash flows for Axtel for 20X1. (Hint: Retiring stock means buying it back from shareholders. Assume the purchase was made at book value, and treat it like a negative sale of stock.) Enter your answers in thousands. For example, an answer of $200 thousands should be entered as 200, not 200000. Use a minus sign, to indicate any decreases in cash or cash outflows.

Axtel Company Statement of Cash Flows For the period ended 12/31/X1 ($000)
OPERATING ACTIVITIES:
	Net Income	$
	Depreciation	$
	Net changes in current accounts	$
Cash from Operating Activities		$
INVESTING ACTIVITIES:
	Increase in Fixed Assets	$
Cash from Investing Activities		$
FINANCING ACTIVITIES:
	Decrease in Debt	$
	Dividends Paid	$
	Stock Retired	$
Cash from Financing Activities		$
NET CASH FLOW		$

Reconciliation
	Beginning Cash	$
	Net Cash Flow	$
	Ending Cash	$

Answer 1

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