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Depreciation expense 39,000 Clearly label the amount of each answer as positive

ID: 2462051 • Letter: D

Question

Depreciation expense

39,000

Clearly label the amount of each answer as positive or negative, and enter your number in whole dollars and use commas and dollar signs.

A. Calculate the amount of cash flows from operations. (Show Calculations)



B. Calculate the amount of cash flows from investing activities. (Show Calculations)


C. Calculate the amount of cash flows from financing activities. (Show Calculations)

D. Calculate the net change in cash. (Show Calculations)

Net income $369,000 Beginning Accounts Payable $119,000

Depreciation expense

   97,000 Ending accounts payable 146,000 Beginning accounts receivable 420,000 Purchase of equipment for cash 612,000 Ending accounts receivable 439,000 Issuance of long-term debt 200,000 Beginning inventory 516,000 Issuance of stock for cash 160,000 Ending inventory 560,000 Issuance of stock for land 110,000 Beginning prepaid expenses    42,000 Purchase of treasury stock 64,000 Ending prepaid expenses    48,000 Sale of long-term investment at cost

39,000

Explanation / Answer

All Amounts in $ A. Cash Flows from Operating Activities Net Income as shown 369000 Add : Depreciation 97000 Operating Cash Flow before Working Capital Changes 466000 Less : Increase in Accounts Receivable -19000 Less : Increase in Inventory -44000 Less : Increase in Prepaid Expenses -6000 Add : Increase in Accounts Payable 29000 -40000 Cash Inflows from Operating Activities 426000 B. Cash Flows from Investing Activities Sale of Long-Term Investment at Cost 39000 Purchase of Treasury Stock -64000 Purchase of Equipment for Cash -612000 Cash Outflows from Investing Activities -637000 C. Cash Flows from Financing Activities Issuance of long-term debt 200000 Issuance of stock for cash 160000 Issuance of stock for land 110000 Cash Inflows from Financing Activities 470000 D. Net Change in Cash = A + B + C 259000

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