Question

The 2018 Income Statement and Balance Sheet of Tampa Clinic, a not-for-profit organization, are presented below Tampa Clinic Income statement Year Ended December 31, 2018 Operating Revenues: Patient service revenue Less provision for bad debts Net patient service revenue Other revenue Net operating revenues $524,630 (27.630) $497,000 10,000 $507 000 Expenses: Salaries and benefits Supplies Insurance Depreciation Interest Total expenses Operating income $231,950 76,050 16,700 8,000 41,000 9373,700 $133,300 Nonoperating income Investment income Net income 700

How does Tampa Clinic’s statement of cash flows compare with Sunnyvale’s statement? Exhibit 4.6.

Answer 1

Statement of Cash flow for Temps Clinic

For the year ended December 31, 2018

A. Cash flow from operating activities
Operating income	133300
Adjustment :
Depriciation expense	8000
Decrease in net patient accounts receivable	10000
Increase in inventories	(9000)
Increase in accounts payable	16000
Decrease in accrued expense	(2000)
Net cash from operating activities (a)	$156300
B . cash flow from investing activities
Non operating income (investment income)	2700
Purchase of long term investment	(27000)
Purchase of property and equipment (290000-70000)	(220000)
Net cash used in investing activities (b)	($244300)
C . cash flow from financing activities
Proceeds from long term debt (130000-20000)	110000
Net cash from financing activities (c)	$110000
Net increase in cash and Cash equivalent (a+b+c)	$22000
Beginning Cash balance	$33000
Ending Cash balance	$55000

Note : we can see that Cash and Cash equivalent of both the companies has increased . Both have positing operating Cash flow, negative investing Cash flow and again positive financial Cash flow. This, both the companies in general have similar trend in cash flows. However, such a comparison of Cash flow is not fully appropriate it is because Cash flow for Sunnyvale is for different year i.e. year 2015 whereas Cash flow for temps clinic is for the year 2018.