Question

The accounting records of Princeton Pharmaceuticals, Inc., reveal the following: E (Click the icon to view the accounting records.) Requirement Compute cash flows from operating activities by the direct method. Also evaluate Princeton's operating cash flow. Give the reason for your evaluation. Start by completing the cash flows from operating activities. (Use parentheses or a minus sign for numbers to be subtracted, for payments, and for a net decrease in cash.) Cash flows from operating activities: Receipts: Collection of dividend revenue Total cash receipts Payments: Total cash payments Net cash provided by (used for) operating activities Evaluate Princeton's operating cash flow. Give the reason for your evaluation. The operating cash flow is This is shown by the

Answer 1

Solution:

Уи 8 9 10 $97,000 $12,000 $109,000 11 12 Princeton Pharmaceuticals inc. Cash Flows from operating activities: Receipts: Collection from Customers ($60000+ $37000) collection of Dividend Revenue Total cash receipts Payments: For Interest -$13,000 For Income Taxes $18,000 To employees $32,000 For Suppliers $55,000 Total cash payments Net Cash provided by (used for) operating activities 13 14 15 16 17 $118,000 $9,000 18 19 20 21 22 23 25 28 29 30 32 34 35 36 37 38 39 41 44 45 et117 ) Sheet118 ) Sheet119 ) Sheet120 Sheet120 (2)

The operating cash flow is weak. This is shown by net cash used for operating activities.