PLEASE DO NOT SOLICIT The financial statements of Pouchie Co. included the follo

Question

PLEASE DO NOT SOLICIT

The financial statements of Pouchie Co. included the following information for the year ended December 31, 2010 (amounts in millions):

I

Complete the following statement of cash flows, using the indirect method. (Enter your answers in millions. Amounts to be deducted and negative net cash amount should be indicated with minus sign. Omit the "$" sign in your response):

  Depreciation and amortization expense $ 269   Cash dividends declared and paid 312   Purchase of equipment 820   Net income 370   Beginning cash balance 137   Proceeds of common stock issued 170   Proceeds from sale of building (at book value) 213   Accounts receivable increase 9   Ending cash balance 114   Inventory decrease 30   Accounts payable increase 66

Explanation / Answer

PARTICULARS AMOUNT CASHFLOW FROM OPERATING ACTIVITIES Net Income 370 (+) Depreciation 269 (+) Increase in Accounts Payable 66 (-) Increase in Accounts Receivable -9 (+) Decrease in Supplies 30 NET CASH PROVIDED 726 CASHFLOW FROM INVESTING ACTIVITIES Sale of Building 213 (-) Purchase of Equipment -820 NET CASH USED -607 CASHFLOW FROM FINANCING ACTIVITIES (+) Issue of Stock 170 (-) Cash Dividends paid -312 NET CASH PROVIDED -142 NET DECREASE 23 OPENING BALANCE 137 CLOSING BALANCE 114

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