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Explain in detail & please explain XYZ Company reported the following balance sheets at December 31, 2017 and 2018: ($ in millions) December 31, Cash...

Explain in detail & please explain


XYZ Company reported the following balance sheets at December 31, 2017 and 2018:


($ in millions)

 

December 31,


Cash

(yr 2018) $ 45

(Yr 2017) $ 40

Accounts receivable

(Year 2018) 170

(Year 2017) 175

Inventory

(Year 2018) 250

(Year 2017) 230

Fixed assets

(Year 2018) 500

(year 2017) 400

Accumulated depreciation

 (yr 2018) (150)

 

 (yr 2017) (120)

Total assets

$ 815

$ 725

Accounts payable

$100

$ 80

Long-term debt

455

425

Common stock

50

50

Retained earnings

280

200

Treasury stock

 

(70)

 

 

(30)

Total liabilities and stockholders' equity

$ 815

$ 725



The income statement for 2018 was as follows:


($ in millions)

Sales

$ 1,000

Cost of sales

(670)

Depreciation

(30)

Other operating expenses

 

(100)

Income before taxes

200

Income taxes

 

(70)

Net income

$ 130


information:


During 2018, XYZ had the following transactions

a. Declared and paid a common dividend of $50 million.

 

b. Purchased additional fixed assets, but did not sell any. c. Issued $30 million of new debt.

d. Paid interest on all its debt, and included the interest in Other operating expenses.

e. Repurchased common shares, but did not issue any.


Required:


Please, prepare cash flow statement for Holmes for 2018, using the indirect method to present the operating section.

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