financing activities 70000 Decrease in cash balance 161000 Beginning cash

Financing activities 70000 decrease in cash balance

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financing activities ................................ 70,000 Decrease in cash balance ................................. $ (161,000) Beginning cash balance ................................................. 170,000 Ending cash balance ...................................................... $ 9,000
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P4–19ConcludedSecond, based on the above information and the total revenue as reported in the 2005 and 2006 income statements, we can compute the amount of revenue generated by Mayberry Enterprises from its consulting services.For 2005$76,000$38,700=$37,300For 2006$89,500$40,800=$48,700Overall, the revenue from each segment can be broken down as follows.Display SalesConsulting ServiceTotal2005$ 38,700$37,300$ 76,000200640,80048,70089,500Total$79,500$86,000$165,500Based on the above, it seems that revenue stream is growing for both product lines. However, the growth is higher in the consulting service product line.P4–20Cash Account..........................................................................23,400Accumulated Depreciation......................................................6,600aEquipment.........................................................................24,400bGain on Sale of Equipment...............................................5,600a$24,300 + $8,700 – $26,400 = $6,600b$84,800 + $37,000 – $97,400 = $24,400It is true that Badger’s net income has more than tripled from 2005 to 2006. However, this increase is entirely due to selling the equipment with a book value of $17,800 ($24,400 – $6,600) for $23,400. This has resulted in a gain of $5,600. Since net income is $5,200, it appears that Badger has lost money from its regular, recurring operations. I am not sure if we should extend any loans to Badger, let alone grant the preferential interest rates. ISSUES FOR DISCUSSION ID4–1
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a. The amount at which MCI would report the SBS system on its balance sheet is the amount MCI gave up to receive it. Since MCI "paid" $376 million in stock and took on a note for $104 million (with the proceeds going to IBM), MCI would report the SBS system at $428 million (i.e., $480 million less $52 million of miscellaneous assets received).
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