In: Finance
Construct the Operating Activities part ONLY for 2017 from the Statement of Cash Flows based on the information below:
Thomas Company 2017 Income Statement ($ in millions) |
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Net sales | $ | 9,530 | |
Cost of goods sold | 7,760 | ||
Depreciation | 465 | ||
Earnings before interest and taxes | $ | 1,305 | |
Interest paid | 104 | ||
Taxable income | $ | 1,201 | |
Taxes | 420 | ||
Net income | $ | 781 | |
Thomas Company 2016 and 2017 Balance Sheets ($ in millions) |
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2016 | 2017 | 2016 | 2017 | ||||||||||
Cash | $ | 230 | $ | 260 | Accounts payable | $ | 1,370 | $ | 1,385 | ||||
Accounts rec. | 1,000 | 900 | Long-term debt | 1,100 | 1,300 | ||||||||
Inventory | 1,810 | 1,695 | Common stock | 3,340 | 3,250 | ||||||||
Total | $ | 3,040 | $ | 2,855 | Retained earnings | 640 | 890 | ||||||
Net fixed assets | 3,410 | 3,970 | |||||||||||
Total assets | $ | 6,450 | $ | 6,825 | Total liab. & equity | $ | 6,450 | $ | 6,825 | ||||
Below si the statement showing Operating Cash Flow :
Amount | |
Net Income | 781 |
Add: Non Cash /Non Operating Item | |
Depreciation (Being Non cash Item) | 465 |
Interest Paid (Non Operating Item) | 104 |
(+/-) Changes in Working Capital | |
Add Decrease in Accounts Receivable (1000 - 900) | 100 |
Add : Decrease in Inventory (1810 - 1695) | 115 |
Add : Increase in Accounts Payable(1385 - 1370) | 15 |
Net Cash flow from Operating Activity | 1580 |