Mgmt 200 Assignment Soln 4-21-10

Mgmt 200 Assignment Soln 4-21-10 - Management 200...

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Krannert School of Management - Purdue University Solutions to class assignment for April 21, 2010 Problem 12-7 Statement Of Cash Flows—Indirect Method 1. Changes in account balances and explanations (in thousands of dollars): Net Change Dr. (Cr.) Explanation Cash 15 Accounts receivable (25) Inventory (50) Prepayments 10 Land 75 Purchase ( c ) Plant and equipment 70 Purchase ( c ) Accumulated depreciation (70) Depreciation expense ( b ) Accounts payable (25) Other accrued liabilities 10 Interest payable (5) Long-term bank loan payable (90) Proceeds from bank loan ( c ) Common stock (50) Issuance of common stock ( c ) Retained earnings 135 35 Dividends ( a ) 100 Net loss Total 0 Statement of cash flows: ASTRO INC. STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2008 (AMOUNTS IN THOUSANDS OF DOLLARS) Cash Flows from Operating Activities Net loss $ (100) Adjustments to reconcile net income to net cash provided by operating activities: Depreciation expense 70 Decrease in accounts receivable 25 Decrease in inventories 50 Increase in prepayments (10)
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Mgmt 200 Assignment Soln 4-21-10 - Management 200...

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