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Assignment Cash Flow Preparation flo higginbotham

Assignment Cash Flow Preparation flo higginbotham - added...

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Crosby Corporation Cash Flow Statement Ending December 31, 2008 Operation activities: Net Income $160,000 Depreciation $150,000 $150,000 ------------- ------------- Cash Flow Totals: $310,000 Accounts receivable -$50,000 Inventory -$20,000 Prepaid expenses $20,000 Accounts payable $190,000 Accrued expenses -$20,000 -------------- Net Capital $120,000 ------------- Operating Activities Cash $430,000 Investment activities: Investments $10,000 Plan and Equipment -$400,000 -------------- Investing Cash -$390,000 Financing activities: Bonds payable $50,000 Common Stock (Dividends paid) -$50,000 Preferred stock (Dividends paid) -$10,000 Financing Cash --------- -$10,000 ------------- Net increase (decrease): $30,000 Beginning of year cash: $70,000 ------------- End of year cash total: $100,000
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#28 Based off of the information I imputed into this statement is that the operating activities net income exceeds $270,000. The explanation why this has occurred is that the amortizations is
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Unformatted text preview: added back in the amount of $150,000, as well as the accounts payable has an increase of $190,000. The person reading this statement gets very important information about just exactly how the daily operations are acquired and what cash flow was produced because of the daily operations. #29 The build up is in the plant and equipment gross of $400,000 and net of $250,000 has been changed by amounts of large increases in the accounts payable area of $190,000. In my opinion this is not very good for the company. The short term sources used are just that short term and may not always be there in the end. This company needs to focus more on capital assets. Seems like a more natural thing to do is more long term ventures like financing mortgages for example. By doing this it allows for money to increase in the areas of bond payable and the add back of amortizations....
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