Question

eu Business School BCO 222 Assignment # 1: Measuring Cash Flows Given the following information for the Manhattan Corporation: Prepare a statement of cash flows for 2018. Manhattan Corporation Balance Sheet for December 31, 2017 and 2018 (in dollars) 2017 2018 Cash 89,000 100,000 Account receivable 64,000 70,000 Inventories 112,000 100,000 10,000 Other current assets 10,000 Total current assets 275,000 238.000 (40,000) 198,000 473,000 280,000 Building and equipment Less: accumulated depreciation Total net fixed assets 311.000 (66,000) 245,000 525,000 Total assets Accounts payable 85,000 90.000 Accrued liabilities 68,000 153,000 70,000 63,000 153,000 0 Total current liabilities Long-term debt Preferred stock 120,000 Common stock 205,000 45,000 473,000 205,000 47,000 525,000 Retained carnings Total debt and equity Manhattan Corporation Income Statement for year ending December 31, 2016 2018 Sales Cost of goods sold Gross profit Operating expenses 184,000 60,000 124,000 Selling, general, and administrative expenses Depreciation 44,000 26,000 70,000 54,000 4.000 50,000 26,000 24,000 Total operating expenses Earnings before interest and taxes Interest expense Earnings before taxes Income taxes Net Income

Answer 1

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Cash Flow
Net Income		$    24,000
Adjustment to Net income:
Depreciation Expenses		$    26,000
Increase in Receivable		$    -6,000
Decrease in Inventory		$    12,000
Increase in Accounts Payable		$      5,000
Decrease in Accrued Liabilities		$    -5,000
Net Cash flow from Operating Activities		$    56,000
Cash flow from Investing activities:
Purchase of Building and Equipment		$ -73,000
Net Cash from Investing Activities		$ -73,000
Cash flow from financing activities:
Issuance of Preferred Stock		$ 120,000
Payment of Debt		$ -70,000
Payment of Dividend Working -1		$ -22,000
Net Cash from Financing Activities		$    28,000
Net Increase in Cash		$    11,000
Add: Beginning Balance		$    89,000
Ending Balance		$ 100,000
Working 1
Beginning Balance Retained Earning		$    45,000
Add: Net Income		$    24,000
Less: Ending Balance		$ -47,000
Payment of Dividend		$    22,000