Question

Using the financial statement provided (an Excel spreadsheet with the data is available on Blackboard), prepare a complete Statement of Cash Flows that shows both the direct method and the indirect method for summarizing cash flow from operating activities. Note to complete the assignment you will need to calculate items such as dividends paid (Retained Earnings & AOCI₂₀₁₉ – Net income₂₀₁₉ – Retained Earnings & AOCI₂₀₁₈) and capital expenditures (Net PP&E₂₀₁₈ – Book Value of PP&E Sold₂₀₁₉ – Depreciation Expense₂₀₁₉ – Net PP&E₂₀₁₉). Please submit your work via the assignment submission feature in Blackboard.

Balance Sheets				Income Statement
(millions)	2019	2018		(millions)	2019
Cash & equivalents	$2,577.0	$1,556.0		Sales	$78,112.0
Accounts receivable, net	1,262.0	1,100.0		Less: Cost of goods sold	54,864.0
Inventories	8,992.0	9,497.0		Gross profit	23,248.0
Other current assets	371.0	366.0		Less: Selling, gen. & admin. expenses	16,163.0
Total current assets	13,202.0	12,519.0		Less: Depr. & amort. expenses	2,357.0
Property, plant, & equipment, gross	45,547.0	44,220.0		Operating profit (EBIT)	4,728.0
Less: Accumulated depreciation	19,664.0	18,687.0		Less: Interest expense	467.0
Property, plant, & equipment, net	25,883.0	25,533.0		Other income (expense)	(18.0)
Right-of-use leased assets	2,536.0	2,215.0		Gain/(loss) on sale of assets	(41.0)
Other long-term investments	137.0	10.0		Earnings before tax	4,202.0
Goodwill	633.0	633.0		Less: Income tax expense	921.0
Other intangible assets	53.0	66.0		Net income	$3,281.0
Other noncurrent assets	635.0	564.0
Total assets	$43,079.0	$41,540.0
Current portion of long-term debt	$94.0	$1,002.0
Short-term debt (notes payable)	41.0	63.0
Current operating lease liabilities	261.0	211.0
Accounts payable	9,920.0	9,761.0
Other accrued expenses	1,983.0	2,034.0
Deferred revenue	1,135.0	840.0
Other current liabilities	1,053.0	1,103.0
Total current liabilities	14,487.0	15,014.0
Long-term debt	10,035.0	9,255.0
Long-term operating lease liabilities	2,275.0	2,004.0
Deferred taxes	1,122.0	972.0
Other long-term liabilities	3,027.0	2,748.0
Total liabilities	30,946.0	29,993.0
Common stock and add. paid-in capital	6,268.0	6,085.0
Retained earnings	11,677.0	9,845.0
Accum. other comp. income (loss)	(868.0)	(805.0)
Less: Treasury stock	4,944.0	3,578.0
Total equity	12,133.0	11,547.0
Total liabilities and equity	$43,079.0	$41,540.0

Footnotes

• During the year, the company received cash of $338.4 when it sold PP&E with a net book value of $379.4, which gave rise to the $41.0 loss that appears on the income statement.
• Total depreciation and amortization expenses of $2,357.0 is made up of depreciation expense of $2.344.0 and amortization expense of $13.0.

Check figures: cash flow from operations = $6,728.0; cash flow from investments = $(3,183.0); and cash flow from financing = $(2,524.0).

Answer 1

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