Question

Use the balance sheet and income statement below :

CLANCY’S DOG BISCUIT CORPORATION Balance Sheet as of December 31, 2015 and 2014 (in millions of dollars)
Assets	2015			2014				Liabilities and Equity	2015			2014
Current assets:								Current liabilities:
Cash and marketable securities	$	8		$	8			Accrued wages and taxes	$	13		$	7
Accounts receivable		38			30			Accounts payable		27			25
Inventory		41			35			Notes payable		25			23
Total	$	87		$	73			Total	$	65		$	55
Fixed assets:								Long-term debt:	$	48		$	43
Gross plant and equipment	$	111		$	90			Stockholders’ equity:
Less: Depreciation		31			25			Preferred stock (2 million shares)	$	2		$	2
								Common stock and paid-in surplus
Net plant and equipment	$	80		$	65			(5 million shares)		11			11
Other long-term assets		28			28			Retained earnings		69			55
Total	$	108		$	93			Total	$	82		$	68
Total assets	$	195		$	166			Total liabilities and equity	$	195		$	166

CLANCY’S DOG BISCUIT CORPORATION Income Statement for Years Ending December 31, 2015 and 2014 (in millions of dollars)
	2015				2014
Net sales	$	108			$	112
Less: Cost of goods sold		54				50
Gross profits	$	54			$	62
Less: Other operating expenses		8				7
Earnings before interest, taxes depreciation,   and amortization (EBITDA)	$	46			$	55
Less: Depreciation		6				6
Earnings before interest and taxes (EBIT)	$	40			$	49
Less: Interest		6				6
Earnings before taxes (EBT)	$	34			$	43
Less: Taxes		16				19
Net income	$	18			$	24
Less: Preferred stock dividends	$	1			$	1
Net income available to common stockholders	$	17			$	23
Less: Common stock dividends		3				3
Addition to retained earnings	$	14			$	20
Per (common) share data:
Earnings per share (EPS)	$	3.40			$	4.60
Dividends per share (DPS)	$	0.60			$	0.60
Book value per share (BVPS)	$	16.00			$	13.20
Market value (price) per share (MVPS)	$	16.65			$	16.60

Prepare a statement of cash flows for Clancy’s Dog Biscuit Corporation. (Enter your answers in millions of dollars. Amounts to be deducted should be indicated with a minus sign. Leave no cells blank - be certain to enter "0" wherever required.)

Statement of Cash Flows for Year Ending December 31, 2015 (in millions of dollars)
A. Cash flows from operating activities
(Click to select)Net incomeNet loss	$
Additions (sources of cash):
(Click to select)Increase in accounts payableIncrease in accrued wages and taxesIncrease in notes payableIncrease in long-term debtDepreciation
(Click to select)Increase in notes payableIncrease in accounts payableIncrease in accrued wages and taxesDepreciationIncrease in long-term debt
(Click to select)DepreciationIncrease in accounts payableIncrease in notes payableIncrease in accrued wages and taxesIncrease in long-term debt
Subtractions (uses of cash):
(Click to select)Increase in accounts receivableIncrease fixed assetsIncrease in inventoryIncrease in notes payableIncrease in long-term debt
(Click to select)Increase in notes payableIncrease fixed assetsIncrease in inventoryIncrease in long-term debtIncrease in accounts receivable
Net cash flow from operating activities	$
B. Cash flows from investing activities
Subtractions:
(Click to select)Increase in other long-term assetsIncrease in fixed assetsIncrease in accrued wages and taxesDepreciationIncrease in accounts payable	$
(Click to select)Increase in other long-term assetsDepreciationIncrease in fixed assetsIncrease in accounts payableIncrease in accrued wages and taxes
Net cash flow from investing activities	$
C. Cash flows from financing activities
Additions:
(Click to select)Increase in notes payableIncrease in accounts payableIncrease in common and preferred stockIncrease accrued wages and taxesIncrease in long-term debt	$
(Click to select)Increase accrued wages and taxesIncrease in notes payableIncrease in long-term debtIncrease in accounts payableIncrease in common and preferred stock
(Click to select)Increase in common and preferred stockIncrease in long-term debtIncrease in notes payableIncrease accrued wages and taxesIncrease in accounts payable
Subtractions:
(Click to select)Preferred stock dividendsIncrease in other long-term assetsIncrease in accounts payableCommon stock dividendsIncrease accrued wages and taxes
(Click to select)Increase accrued wages and taxesIncrease in accounts payablePreferred stock dividendsCommon stock dividendsIncrease in other long-term assets
Net cash flow from financing activities	$
D. Net change in cash and marketable securities	$

Answer 1

Statement of Cash Flows for Year Ending December 31, 2015
(in millions of dollars)
A. Cash flows from operating activities
Net Income Before interest & Other expenses	40
Additions (sources of cash):
Increase in Accounts Payable	2
Increase in Accrued Wages and taxes	6
Increase in Notes Payable	2
Subtractions (uses of cash):
Increase in Account Receivable	-8
Increase in Inventory	-6
Taxes	-16
Net cash flow from operating activities	20
B. Cash flows from investing activities
Subtractions:
Purchase of Plant & Euipment	-15
Net cash flow from investing activities	-15
C. Cash flows from financing activities
Additions:
Increase in Long Term Debt	5
Interest Paid	-6
Subtractions:
Dividend to Preferred Shareholder	-1
Common Stock Dividend	-3
Net cash flow from financing activities	-5
D. Net change in cash and marketable securities	0
Add: Opening cash Balance	8
Closing Cash Balance	8