Foundations Of Finance
10th Edition
ISBN: 9780134897264
Author: KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher: Pearson,
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Chapter 3.A, Problem 4SP
Summary Introduction
To prepare: Statement of cash flows for Company K.
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. ABC company had the following transactions during the month of April 2020. They would like you,
their accountant, to prepare a cash flow statement. Before preparing the statement, you first need to
determine whether the items below results in a cash inflow or outflow in the statement of cash flows.
Second, you are required to determine whether the transaction is an operating, investing, or financing
activity by placing an √ in the appropriate columns.
Please answer all of the following questions and kindly type it out if possible so I can easily understand. I have attached two pictures with the information to complete the questions. Thank You :)
As part of your analysis, you are required to investigate WITCO’s cash flows.
(a)Using the financial statements and additional notes provided, calculate the following for 2020:
iv. Cash Flow from assets
v. Cash Flow to creditors
vi. Cash Flow to stockholders
(b) Prepare WITCO’s Statement of Cash Flow for the year ended December 31, 2020.
(c)What is the purpose and importanceof the Cash Flow Statement?
Cash flow identity. Use the data from the following financial statements in the popup window,. The company paid
interest expense of $17,100 for 2017 and had an overall tax rate of 40% for 2017. Verify the cash flow identity:
cash flow from assets = cash flow to creditors + cash flow to owners
The cash flow from assets is $
(Round to the nearest dollar.)
Chapter 3 Solutions
Foundations Of Finance
Ch. 3.A - (Computing free cash flows) Given the following...Ch. 3.A - Prob. 2SPCh. 3.A - Prob. 3SPCh. 3.A - Prob. 4SPCh. 3 - A companys financial statements consist of the...Ch. 3 - How do gross profits, operating profits, and net...Ch. 3 - How do dividends and interest expense differ?Ch. 3 - Why is it that the preferred stockholders equity...Ch. 3 - Prob. 5RQCh. 3 - Prob. 6RQ
Ch. 3 - Prob. 7RQCh. 3 - Prob. 8RQCh. 3 - Prob. 9RQCh. 3 - Prob. 1SPCh. 3 - Prob. 2SPCh. 3 - (Preparing an income statement) Prepare an income...Ch. 3 - (Preparing a balance sheet) Prepare a balance...Ch. 3 - Prob. 5SPCh. 3 - Prob. 6SPCh. 3 - Prob. 7SPCh. 3 - (Working with income statement and balance sheet)...Ch. 3 - (Working with a statement of cash flows) Given the...Ch. 3 - Prob. 10SPCh. 3 - Prob. 11SPCh. 3 - Prob. 12SPCh. 3 - Prob. 13SPCh. 3 - Prob. 14SPCh. 3 - Prob. 15SPCh. 3 - Prob. 16SPCh. 3 - Prob. 1MCCh. 3 - Prob. 2MCCh. 3 - Prob. 3MC
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- Use the following excerpts from Franklin Companys statement of cash flows and other financial records to determine the companys free cash flow for 2018 and 2017.arrow_forwardUse a spreadsheet and the following financial information from Mineola Companys financial statements to build a template that automatically calculates the net operating cash flow. It should be suitable for use in preparing the operating section of the statement of cash flows (indirect method) for the year 2018.arrow_forwardThe following shows excerpts from financial information relating to Aspen Company and Bergamot Company. Compute the following for both companies. Compare your results. A. free cash flow B. cash flows to sales ratio C. cash flows to assets ratioarrow_forward
- Use the following excerpts from Swahilia Companys financial information to prepare a statement of cash flows (direct method) for the year 2018.arrow_forwardUse the following excerpts from OpenAir Companys financial information to prepare a statement of cash flows (indirect method) for the year 2018.arrow_forwardUse the following excerpts from Zowleski Companys financial information to prepare a statement of cash flows (indirect method) for the year 2018.arrow_forward
- Use the following excerpts from Stern Companys financial information to prepare a statement of cash flows (indirect method) for the year 2018.arrow_forwardHought Office Machines, Inc.'s accountants assembled the following selected data for the year ended December 31, 2018: E (Click the icon to view the current accounts.) E (Click the icon to view the transaction data.) Requirement 1. Prepare Hought Office Machines, Inc.'s statement of cash flows using the indirect method to report operating activities. List noncash investing and financing activities on an accompanying schedule. Complete the statement one section at a time, beginning with the cash flows from operating activities. (Use parentheses or a minus sign for numbers to be subtracted.) Hought Office Machines, Inc. Data Table Statement of Cash Flows Year Ended December 31, 2018 Cash flows from operating activities: Transaction Data for 2018: Net income Net income..... $ 60,000 Adjustments to reconcile net income to net cash Purchase of treasury stock. 14,300 provided by (used for) operating activities: Issuance of common stock for cash. 36,600 Loss on sale of equipment. 6,000…arrow_forward(AACSB) AnalysisYou review a company’s statement of cash flows and find that cash inflows from operations are $150,000,net outflows from investing are $80,000, and net inflows from financing are $60,000. Did the company’scash balance increase or decrease for the year? By what amount? What types of activities would you findunder the category investing activities? Under financing activities? If you had access to the company’sincome statement and balance sheet, why would you be interested in reviewing its statement of cash flows?What additional information can you gather from the statement of cash flows?arrow_forward
- Prepare a statement of cash flows and cash flow worksheet for Tater Tot Corporation for the year 2013. (Use the indirect method.).arrow_forwardAs part of your analysis, you are required to investigate Insignia Corporation Limited’s cash flows. Required: Using the financial statement provided: Calculate the following for 2020: Cash Flow from Assets Cash Flow to Creditors Cash Flow to Stockholdersarrow_forward• How much is cas • How much is the net increase or . How much is cash as at December 31, 2016? Case B-Lupin Services Cash payments to suppliers of goods and services Cash receipts from rendering of services Payments to owners Proceeds from bank loans Proceeds from cash investment of owners Payments for income taxes Payment for interest Proceeds for dividends of investment Payment for acquisition of equipment Cash at the beginning of the year (12,500) 25,000 (2,500) 12,500 57,500 (6,000) (6,250) 7,500 30,000 300,000 agearrow_forward
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