Question

In: Finance

Calculate the net impact on cash given the followinginformation: increase in accounts receivable = $10;...

Calculate the net impact on cash given the following information: increase in accounts receivable = $10; increase in inventory = $15; net fixed asset acquisitions = $300; increase in accounts payable = $50; decrease in notes payable = $60; decrease in long-term debt = $200; increase in retained earnings = $42; increase in common stock = $80.

Multiple Choice

  • $413 net addition to cash.

  • $185 net addition to cash.

  • $226 net addition to cash.

  • $226 net deduction from cash.    

  • $413 net deduction from cash.

Solutions

Expert Solution

Here Change in cash=Change in accounts payable+Change in notes payable+Change in debt+Change in retained earnings+Change in common stock-Change in account recievable-Change in inventory-net fixed asset aquisition

Here Change in cash=50-60-200+42+80-10-15-300

=-413

Thus the correct answer is $413 net deduction from cash.


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