Question

Use the balance sheet and income statement below: 2018 2017 $ 65 $ 53 153 164 143 143 VALIUM'S MEDICAL SUPPLY CORPORATION Balance Sheet as of December 31, 2018 and 2017 (in thousands of dollars) 2018 2017 Liabilities and Equity Current liabilities: $ B4 $ 83 Accrued wages and taxes 19 B 193 Accounts payable 326 303 Notes payable $ 60B $ 579 Total Long-term debt $1,109 $ 906 Stockholders' equity: Preferred stock (6 thousand shares) $ 781 Common stock and paid-in surplus (100 thousand shares) 158 Retained earnings $1,097 $ 939 Total $1,705 $1.518 Total liabilities and equity $ 372 5 349 Assets Current assets: Cash and marketable securities Accounts receivable Inventory Total Fixed assets: Gross plant and equipment Less: Accumulated depreciation Net plant and equipment Other long-term assets Total Total assets $ 617 $ 580 $ 939 120 463 $ 716 $1,705 $ 589 $1,518 VALIUM'S MEDICAL SUPPLY CORPORATION Income Statement for Years Ending December 31, 2018 and 2017 (in thousands of dollars) 2018 2017 Net sales $ 916 $ 826 Less: Cost of goods sold 401 364 Gross profits $ 515 $ 462 Less: Other operating expenses 53 Earnings before interest, taxes, depreciation, and amortization (EBITDA) $ 456 $ 409 Less: Accumulated depreciation 45 Earnings before interest and taxes (EBIT) $ 411 $ 366 Less: Interest Earnings before taxes (EBT) Less : Taxes Net income Less: Preferred stock dividends Net income available to common stockholders $ 202 Less: Common stock dividends Addition to retained earnings $ 127 $ 10B Per (common) share data: Earnings per share (EPS) $2.02 $1.83 Dividends per share (DPS) $0.75 $0.75 Book value per share (BVPS) $7.10 $5.83 Market value (price) per share (MVPS) $8.13 $6.31 Prepare a statement of cash flows for Valium's Medical Supply Corporation. (Enter your answers in thousands. Amounts to be deducted should be indicated with a minus sign.)

Answer 1

Valium's Medical Supply Corporation Statement of Cash Flows for Year Ending December 31, 2018 A. Cash flows from operating activities Net income Additions (sources of cash): Depreciation Increase in accrued wages and taxes Increase in accounts payable Subtractions (uses of cash) Increase in accounts receivable Increase in inventory 208 45 12 11 -5 -23 Net cash flow from operating activities: 248 B. Cash flows from investing activities Subtractions: Increase in fixed assets Increase in other long-term assets -203 C Net cash flow from investing activities: -203 c. Cash flows from financing activities Additions: Increase in notes payable Increase in long-term debt Increase in common and preferred stock 37 0 Subtractions: Preferred stock dividends Common stock dividends -6 -75 Net cash flow from financing activities: D. Net change in cash and marketable securities -44 1