Question

In: Finance

Homework 2 Statement of Cash flows Construct a cash flow statement for XYZ Company using the...

Homework 2 Statement of Cash flows

Construct a cash flow statement for XYZ Company using the following information

                             XYZ COMPANY

                            BALANCE SHEET

                      DECEMBER 31, 2006, 2007

                   Assets                Liab + equity

                  2006  2007                           2006 2007

Cash              120   150         Acc. payable      200  150

Mkt. Sec          80   100          Notes payable     300 250  

Acc. Rec          360  200          other liab.       100 150

Inventory         340  600

current assets    900  1050         Current liab.     600 550

Gross FA          2200 2400         Long term debt    1000 1200

Acc. Dep          500  600          Common stock      400 250

Net fixed asset   1700 1800         Retained earnings 600  850

Total assets      2600 2850        Total liab.+equity 2600 2850

The firm’s EAT for 2007 was 400

Solutions

Expert Solution

Dividend = Beginning retained earnings + Net income - Ending retained earnings
Dividend = $600 + $400 - $850
Dividend = $150


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