Given the following balance sheets for Leland Trucking answer the next four ques
ID: 2811946 • Letter: G
Question
Given the following balance sheets for Leland Trucking answer the next four questions. Joshua Trucking's net income was $12 million. It paid out $10 million in dividends.The company issued $10 million in stock. All numbers are in millions.
Leland Trucking
December 31 Balance Sheets
($in millions)
20X4
20X5
$8
$5
31
31
21
30
$60
$66
$147
$180
40
50
107
$130
$167
$196
$12
14
3
2
$15
$16
64
80
15
25
73
75
$167
$196
1. What is Joshua's Net Change in Current Accounts?
A. $-12
B. $-8
C. $-30
D. $8
E. $12
2. What is Joshua's Change in Operating Activities?
A. $30
B. $14
C. $32
D. $20
E. $-6
3. What is Joshua's Change in Financing Activities?
A. $36
B. $26
C. $16
D. -$26
E. -$20
4. What is the final NET CASH FLOW figure?
A. $3
B. $63
C. $-3
D. $-29
E. $17
Leland Trucking
December 31 Balance Sheets
($in millions)
20X4
20X5
Cash$8
$5
Accounts Receivable31
31
Inventory21
30
Total Current Assets$60
$66
Gross Plant and Equipment$147
$180
Less Depreciation40
50
Net Plant and Equipment107
$130
Total Assets$167
$196
Accounts Payable$12
14
Accrued Wages and Taxes3
2
$15
$16
Long Term Debt64
80
Common Stock15
25
Retained Earnings73
75
Total Liabilities and Equity$167
$196
Explanation / Answer
1. D. $ 8
Net working capital 2004 = Total Current Assets ( excluding cash ) - Total Current Liabilities = $ 52 - 15 = $ 37
Net working capital 2005 = $ 61 - $ 16 = $ 45.
Net change in current accounts = $ 45 - $ 37 = $ 8.
2. B. $ 14
Net income for 2005 = $ 12
Net cash flow from Operating Activities = Net Income + Depreciation - Increase in Current Assets + Increase in Current Liabilities = $ 12 + $ 10 - $ 9 + $ 1 = $ 14
3. B. 26
Net cash flows from Financing Activities = Increase in Long Term Debt + Increase in Common Stock = $ 16 + $ 10 = $ 26.
4. C. $ - 3
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.