Valley Mills Enterprises Presented here are cash flows (in S Millions) for Valle
ID: 2392186 • Letter: V
Question
Valley Mills Enterprises Presented here are cash flows (in S Millions) for Valley Mills Enterprises' most recent fiscal year. Cash received from: Customers $2,500 300 250 700 1,500 Interest on investments Sale of old equipment Sale of company's capital stock Long-term debt proceeds Cash paid for: Interest on debt $500 120 900 5,000 1,500 300 625 Income tax Principal payments on debt Purchase of building Purchase of inventory Dividends on capital stock Operating expenses 35) Cash flows from operating activities are A) $55 B) $175 C) $(245) D) $555 36) Cash flows from investing activities are A) $(3,250) B) $(4,450) C) $(4,750) D) $(5,000) 37) Cash flows from financing activities are A) $(500) B) $880 C) $1,000 D) $1,300 38) Bookworm Booksellers reported sales revenue of $350,000 for the fiscal year ended July 31. The accounts receivable balance at the beginning of the year was $26,000 and $35,000 at the end of the year. On the statement of cash flows, what amount of cash would be shown as collected from customers? A) $324,000 B) $341,000 C) $350,000 D) $359,000Explanation / Answer
Q35) Required cash = Cash from customers – Interest on debt – Income tax – Operating expenses – Inventory
= 2,500 – 500 – 120 – 625 – 1,500
= $(245)
Answer: C
Q36) Required cash = Interest on investment + Equipment – Purchase of building
= 300 + 250 – 5,000
= $(4,450)
Answer: B
Q37) Required cash = Sale of stock + Debt proceeds – Payments of debt – Dividends
= 700 + 1,500 – 900 – 300
= $1,000
Answer: C
Q38) Required collection = Revenue + Beginning AR balance – Ending AR balance
= 350,000 + 26,000 – 35,000
= $341,000
Answer: B
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