Question

#1 Portions of the financial statements for Clear Transmissions Company are provided below.
CLEAR TRANSMISSIONS COMPANY
Income Statement
For the Year Ended December 31, 2018 ($ in 000s)
Sales						$1,740.00
Cost of goods sold						696
Gross margin						1,044
Salaries expense				$304.00
Depreciation expense				215
Patent amortization expense				24
Interest expense				68
Loss on sale of cash equivalents				13		624
Income before taxes						420
Income tax expense						210
Net Income						$210.00
CLEAR TRANSMISSIONS COMPANY
Selected Accounts from Comparative Balance Sheets
December 31, 2018 and 2017 ($ in 000s)
			Year
			2018	2017	Change
Cash			$123.00	$114.00	$9.00
Accounts receivable			234	253	-19
Inventory			447	464	-17
Accounts payable			175	162	13
Salaries payable			87	100	-13
Interest payable			46	34	12
Income taxes payable			36	24	12
Required:
Prepare the cash flows from operating activities section of the statement of cash flows for Clear Transmissions Company using the direct method. (Enter your answers in thousands (i.e., 5,000 should be entered as 5). Amounts to be deducted should be indicated with a minus sign.)
	Cash Flows from Operating Activities:
	Net cash flows from operating activities				$
#2   In preparation for developing its statement of cash flows for the year ended December 31, 2018, Rapid Pac, Inc., collected the following information:
						($ in millions)
Fair value of shares issued in a stock dividend						80
Payment for the early extinguishment of						89
long-term bonds (book value: $84.0 million)
Proceeds from the sale of treasury stock (cost: $20.0million)						25
Gain on sale of land						2.9
Proceeds from sale of land						8.7
Purchase of Microsoft common stock						148
Declaration of cash dividends						54
Distribution of cash dividends declared in 2017						50
Required:
1. In Rapid Pac’s statement of cash flows, what were net cash inflows (or outflows) from investing activities for 2018?
2. In Rapid Pac’s statement of cash flows, what were net cash inflows (or outflows) from financing activities for 2018?
1.) In Rapid Pac’s statement of cash flows, what were net cash inflows (or outflows) from investing activities for 2018? (Amounts to be deducted should be indicated with a minus sign. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).)
																($ in millions)
										Cash Flows From Investing Activities:
Net cash inflows (outflows) from investing activities
2.) In Rapid Pac’s statement of cash flows, what were net cash inflows (or outflows) from financing activities for 2018? (Amounts to be deducted should be indicated with a minus sign. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).)
																($ in millions)
										Cash Flows From Financing Activities:
Net cash inflows (outflows) from financing activities

Answer 1

Cash flow Statement

s.no	Particulars	cash inflows	cash outflows	amount in thousands	amount in millions
1.	cash from financing activies
	sales revenue	1740
	Gross profit margin	1044
	Cost of goods sold		696
	salaries expense		304
	Depreciation		215
	Patent amortisation expense		24
	interest expense		68
	loss on sale cash equivalents		13
	income tax expense		210
	income before tax	420
	net income	210
	total	3414	1530	1884	1.884
2.	cash flow from operating activities
	increase in cash	9
	decrease in salary payable	13
	decrease in accounts receivable		19
	decrease in inventory		17
	increase in accounts payable		13
	increase in interest payable		12
	increase in taxes payable		12
	total -assets and liabilities are (73-23) = -51	73	23	-51
	Gain on sale of land	2.9
	proceed from sale of land	8.7		11600
	Total from operating activities (11600-51) =11549			11549	11.549
3.	cash flow from investing activities
	fair value of share issued at stock dividends	80
	sale of treasury stock	25
	payment of long term bonds		89
	purchase of microsoft common stock		148
	Declaration of cash dividends		54
	Distribution of cash dividends (Dec. in 2017)		50
	total cash from investing activities	105	341		-236

cash flow from financing activities = $1.884 million

cash flow from operating activities = $11.549 million

cash flow from investing activities = $(-236) million