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e | https://newconnect.mheducation.com/flow/connect.html Pre-Built Problems Saved Cardinal Industries had the following operating results for 2018: Sales $34,924; Cost of goods sold-$24506; Depreciation expense $6,057: Interest expense = $2.740; Dividends paid $2.050. At the beginning of the year, net fixed assets were $20,000, current assets were $7.096, and current liabilities were $4,028. At the end of the year net fixed assets were $24,556, current assets were $8,720, and current liabilities were $4,727. The tax rate for 2018 was 23 percent. a. What is net income for 2018? (Do not round intermediate caiculations.) b. What is the operating cash flow for 2018? (Do not round intermediate calculations.) c. What is the cash flow from assets for 2018? (Do not round intermediate colculations. d- If no new debt was issued during the year, what is the cash flow to creditors? (Do not d- If no new debt was issued during the year, what is the cash flow to stockholders? (Do A negative answer should be indicated by a minus sign.) 1. round intermediate calculations.) d intermediate calculetions. A negative answer should be indicated by a minus sign.) ences a. Net income b. Operating cash flow c. Cash flow from assets d.1. Cash flow to creditors 3.361 12.158 d2. Cash fow to stockholders393 4,556 3.993 pe here to search

Explanation / Answer

a Income Statement   Sales $34,924.00   Cost of goods sold    24,506.00   Depreciation      6,057.00   EBIT      4,361.00   Interest      2,740.00   Taxable income      1,621.00   Taxes (23%)        372.83   Net income $ 1,248.17 b OCF = EBIT + Depreciation Taxes OCF = $4,361 + 6,057 372.83 OCF = $10,045.17 c Change in NWC = NWCend NWCbeg Change in NWC = (CAend CLend) (CAbeg CLbeg) Change in NWC = ($8,720 4,727) ($7,096 4,028) Change in NWC = $3,993 3,068 Change in NWC = $925 Net capital spending = NFAend NFAbeg + Depreciation Net capital spending = $24,556 20,000 + 6,057 Net capital spending = $10,613 CFA = OCF Change in NWC Net capital spending CFA = $10,045.17 925 10,613 CFA = $1,492.83 d Cash flow to creditors = Interest – Net new LTD Cash flow to creditors = $2,740 0 Cash flow to creditors = $2,740 Cash flow to stockholders = Cash flow from assets Cash flow to creditors Cash flow to stockholders = –$1,492.83 2,740 Cash flow to stockholders = $4,232.83

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