Question

Use the following information for Ingersoll, Inc., (assume the tax rate is 35 percent) 2014 2015 Sales Depreciation Cost of goods sold Other expenses Interest Accounts receivable Short-term notes payable Long-term debt Net fixed assets Accounts payable Inventory Dividends $ 8,235 $ 8,809 1,166 3,100 574 643 5,243 6,167 786 13,90016,450 34,855 35,757 4,225 9,978 1,091 1,165 2,736 679 565 4,149 5,479 834 4,396 9,710 996 For 2015, calculate the cash flow from assets, cash flow to creditors, and cash flow to stockholders. (Do not round intermediate calculations. A negative answer should be indicated by a minus sign. Round your answers to 2 decimal places, e.g., 32.16.) Cash flow from assets Cash flow to creditors Cash flow to stockholders

Answer 1

Operating Cash Flow = EBIT + Depreciation - Taxes
Operating Cash Flow = $3,969.00 + $1,166.00 - $1,164.10
Operating Cash Flow = $3,970.90

Change in NWC = NWC, 2015 - NWC, 2014
Change in NWC = ($21,388 - $5,011) - ($19,338 - $5,230)
Change in NWC = $2,269

Net Capital Spending = Net Fixed Assets, 2015 + Depreciation - Net Fixed Assets, 2014
Net Capital Spending = $35,757 + $1,166 - $34,855
Net Capital Spending = $2,068

Cash Flow from Assets = Operating Cash Flow - Net Capital Spending - Change in NWC
Cash Flow from Assets = $3,970.90 - $2,068 - $2,269
Cash Flow from Assets = -$366.10

Net New Long-term Debt = Long-term Debt, 2015 - Long-term Debt, 2014
Net New Long-term Debt = $16,450 - $13,900
Net New Long-term Debt = $2,550

Cash Flow to Creditors = Interest Expense - Net New Long-term Debt
Cash Flow to Creditors = $643 - $2,550
Cash Flow to Creditors = -$1,907

Cash Flow from Assets = Cash Flow to Creditors + Cash Flow to Stockholders
-$366.10 = -$1,907 + Cash Flow to Stockholders
Cash Flow to Stockholders = $1,540.90