Chapter4_In_Class[1]

Chapter4_In_Class[1] - Chapter 4 The Statement of Cash...

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1 Chapter 4 The Statement of Cash Flows In Class Practice Questions 1. Excellence Hotel’s balance sheets and income statements for 2007 and 2006 are available as follows: Excellence Hotel Consolidated Balance Sheets at Dec 31, 2007 and 2006 (in Thousands) 2007 2006 Assets Current Assets Cash $4,061 $2,382 Cash equivalent 5,272 8,004 Accounts receivable 8,960 8,350 Inventories 47,041 36,769 Prepaid expenses 512 759 Total current assets 65,846 56,264 Property and equipment 40,607 26,507 Accumulated depreciation and amortization (11,528) (7,530) Net property and equipment 29,079 18,977 Other assets 373 668 Total Assets $95,298 $75,909 Liabilities and Owners' Equity Current Liabilities Accounts payable $14,294 $7,591 Notes payable - banks 5,614 6,012 Current maturities of long-term debt 1,884 1,516 Accrued liabilities 5,669 5,313 Total current liabilities 27,461 20,432 Deferred income taxes 843 635 Long-term debt 21,059 16,975 Total liabilities 49,363 38,042 Owners' equity Common stock 4,803 4,594 Additional paid-capital 957 910 Retained earnings 40,175 32,363 Total owners' equity 45,935 37,867 Total Liabilities and owners' equity $95,298 $75,909
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2 Excellence Hotel Consolidated Income Statements for Years Ended Dec 31, 2007 and 2006 (in Thousands) 2007 2006 Revenue Net sales $215,600 $153,000 Interest income 422 838 216,022 153,838 Expenses Salaries and wages 129,364 91,879 Marketing, administrative, and other expenses 66,993 49,315 Interest expense 2,585 2,277 Income taxes 7,686 4,457 Net income $9,394 $5,910 Excellence Hotel Worksheet for Preparing Statement of Cash Flows (in Thousands) Chang 2007 2006 (2007-2006) Category Assets (1) Cash $4,061 $2,382 $1,679 Cash (2) Cash equivalent 5,272 8,004 (2,732) Cash (3) Accounts receivable 8,960 8,350 610 Operating (4) Inventories 47,041 36,769 10,272 Operating (5) Prepaid expenses 512 759 (247) Operating (6) Property and equipment 40,607 26,507 14,100 Investing (7) Accumulated depreciation and amortization (11,528) (7,530) (3,998) Operating (8) Other assets 373 668 (295) Investing Liabilities and Owners' Equity Liabilities (9) Accounts payable 14,294 7,591 6,703 Operating (10) Notes payable - banks 5,614 6,012 (398) Financing (11) Current maturities of long-term debt 1,884 1,516 368 Financing (12) Accrued liabilities 5,669 5,313 356 Operating (13) Deferred income taxes 843 635 208 Operating (14) Long-term debt 21,059 16,975 4,084 Financing Owners' equity (15) Common stock 4,803 4,594 209 Financing (16) Additional paid-capital 957 910 47 Financing (17) Retained earning (a) Net income 9,394 Operating (b) Dividends paid (1,582) Financing Net change in retained earnings 40,175 32,363 $7,812
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3 (1) Prepare a statement of cash flow from Operating activities using the indirect method. Excellence Hotel Cash Flows from Operating Activities
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Chapter4_In_Class[1] - Chapter 4 The Statement of Cash...

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