Question

Fitbit, Inc., reported the following information for the nine-month period ended October 1, 2016. Items are in thousands of dollars.

Accounts Payable	$	520,100
Accounts Receivable		462,000
Advertising Expense		80,500
Cash (January 1, 2016)		665,100
Cash (October 1, 2016)		679,170
Common Stock		834,200
Equipment		256,100
Office Expenses		114,600
Income Tax Expense		19,000
Interest Expense		3,300
Inventories		215,700
Notes Payable		54,400
Operating Expenses		263,800
Retained Earnings (January 1, 2016)		261,000
Sales Revenue		511,570
Supplies		87,100

Other cash flow information:
Cash received from issuing common stock	$	39,470
Cash paid to purchase equipment		67,500
Cash paid to suppliers and employees		489,400
Cash received from customers		530,700
Cash received from sale of long-term assets		800
Dividends paid to stockholders		0

4. Prepare a statement of cash flows for the nine months ended October 1, 2016. (Cash outflows should be entered as negative amounts. Enter your answers in thousands.)

Answer 1

Cash flow statement is prepared using direct method where only cash received from customer and cash paid to suppliers and employees would be considered. Since opening balance of payable and receivables are not given, changes in working capital cannot be computed. So, direct method is used.

Cash flow statement: