Net cash provided by used in investing activities 500

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Net cash provided by (used in) investing activities (500) Net cash provided by (used in) operating activities 500 Net income 400 Net increase in cash and equivalents 100 Notes payable increase 50 Purchase of plant and equipment (500) Smithey Sporting Goods: Statement of Cash Flows (in $1,000) CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 400 Depreciation and amortization 300 Accounts receivable decrease (increase) (100) Inventories decrease (increase) (150) Accounts payable increase (decrease) 50 Net cash provided by (used in operating activities) 500
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CASH FLOWS FROM INVESTING ACTIVITIES Purchase of plant and equipment (500) Net cash provided by (used in) investing activities (500) CASH FLOWS FROM FINANCING ACTIVITIES Notes payable increase 50 Issuance of long-term debt, net 200 Increase (Decrease) in other long-term liabilities (50) Cash dividends (common stock) (100) Net cash provided by (used in) financing activities 100 Net increase (decrease) in cash and equivalents 100 Cash equivalent at beginning of year 100 Cash and equivalent at end of year $ 200 75. For the following income statement and balance sheet, fill in the missing information for the calendar year ending December 31. Sales _______ COGS 200,000 Gross Profit _______ Expenses 300,000 EBIT _______ Interest Expense 10,000 EBT _______ Tax Expense (40%) 36,000 Net Income _______ Retained Earnings (Jan 1) 150,000 Dividends Declared 25,000 Current Assets (Dec 31) 150,000 Non-current Assets (Dec 31) _______ Total Assets (Dec 31) _______ Current Liabilities (Dec 31) 75,000 Long-term Liabilities (Dec 31) _______ Total Liabilities(Dec 31) 171,000 CS and Capital in excess of par 300,000 Retained Earnings (Dec 31) _______ Total Stockholders’ Equity _______ ANSWER: . Sales 600,000 COGS 200,000 Gross Profit 400,000
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Expenses 300,000 EBIT 100,000 Interest Expense 10,000 EBT 90,000 Tax Expense (40%) 36,000 Net Income 54.000 Retained Earnings (Jan 1) 150,000 Dividends Declared 25,000 Current Assets (Dec 31) 150,000 Non-current Assets (Dec 31) 500,000 Total Assets (Dec 31) 650,000 Current Liabilities (Dec 31) 75,000 Long-term Liabilities (Dec 31) 96,000 Total Liabilities(Dec 31) 171,000 CS and Capital in excess of par 300,000 Retained Earnings (Dec 31) 179,000 Total Stockholders Equity 479,000 V. Short Answers 76. Describe the purpose of an income statement. An income statement reports the profit (loss) of a firm during a specific period of time. 77. Describe the purpose of a balance sheet. A balance sheet reports the financial condition of a firm at one point in time. 78. Describe the purpose of a statement of cash flows A statement of cash flow shows how the cash position of the firm has changed during the period covered by the income statement. 79. Explain why the notes to a firm's financial statements are an integral part of the financial statements. The notes to a firm's financial statements form an integral part of the financial statements because they disclose the significant accounting policies used to prepare the financial statements and provide additional detail concerning some of the items in the financial statements.
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