Question

Use the following tinancial statements: Dynamic Mattress Year-End Balance Sheet for 2014 (figures in $ millions) Current Liabilities: Bank loans Current Assets Cash Marketable securities Accounts receivable Inventory 49 134 183 188 Accounts payable 137 142 467 Long-term debt Total current liabilities Total current assets 84 428 Net worth (equity and retained earnings) Fixed assets Gross investment Less depreciation Net fixed assets 332 104 228 695 Total assets Total liabilities and net worth 695 Dynamic Mattress Year-End Balance Sheet for 2013 (figures in $ millions) Current Liabilities Bank loans Current Assets Cash Marketable securities Accounts receivable Inventory 32 87 119 152 Accounts payable 98 Total current liabilities Total current assets 360 Long-term debt 37 360 Net worth (equity and retained earnings) Fixed assets Gross investment Less depreciation Net fixed assets 238 82 156 516 Total assets Total liabilities and net worth 516

Answer 1

Dynamic Mattress Statement of Cash Flows for 2014 (figures in $ million) Sources: Sold marketable securities Increased bank loans Increased accounts payable Increased long term debt Cash from operations $22 $22- $0] $17 S49 $32] $47 $134 $87] $47 [$84 $37] $100 $22 $255 Net income Depreciation Total Sources Cross Check: Uses: Increased inventories Increased accounts receivable Invested in fixed assets Dividend $54 $142 $88] $39 $137 $98] $94 I$332-$238] $32 $219 $152 Cash, beginning balance Add: Increase in cash balance S36 As per Statement of Cash Flows Cash, ending balance $188 -> Matched with cash reported on 2014's Balance sheet Total Uses Increase in Cash Balance [Total Sources - Total Uses] ($255- $219)