Question

Jetson Spacecraft Corp. shows the following information on its 2011 income statement sales- $235,000, costs $141,000; other ex interest expense $12,900, taxes $19,565, dividends $12.300. In addition, your're told that the firm issued $6,100 in new equity during 2011 and redeemed $4,500 in outstanding long-term debt a. What is the 2011 operating cash flow? b. What is the 2011 cash flow to creditors? c. What is the 2011 cash flow to stockholders? d. If net fixed assets increased by $25,000 during the year, what was the addition to NwC? penses $7,900, depreciation expense S17,300

Answer 1

Calculation of 2011 Operating Cash Flow: 1 Sales 2 Less:Costs $235,000 $141,000 $7,900 $12,900 $19,565 Other expenses Net Operating cash flow $53,635 Calculation of 2011 Cash flow to creditors: Cash flow to creditors Interest paid Net new borrowings $12,900 (-$4,500) $17,400 Calculation of 2011 Cash flow to Stockholders sh flow t holders: Dividend paid- Net new equity $12,300 - $6,100 $6,200 To find change in NWC: Cash flow from Assets Cash flow to creditors+ Cash flow to stockholders $17,400+$6,200 $23,600 Net capital spending Depreciation Increase in fixed assets $17,300$25,000 $42,300 Cash flow from Assets Operating cash flow Change in NWC-Net capit al spending $23,600 $23,600 $53635 Change in NWC -$42,300 $11,335- Change in NWC Change in NWC: ($12,265)