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Question - Cash Flow Analysis 2019 2018 2017 Income Statement: Sales 120,000 100,000 90,000 COGS -84,000 -70,000 -63,000 Gross Margin 36,000 30,000...
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Question

<br/>A.  Prepare Statements of Cash Flows for 2019 and 2018.<br/><br/><br/>B.  Explain

why cash increased in 2019 and 2018 with reference to your cash flows and the "days" information.


C.  Which financing strategy is the company using?

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Question - Cash Flow Analysis
2019
2018
2017
Income Statement:
Sales
120,000
100,000
90,000
COGS
-84,000
-70,000
-63,000
Gross Margin
36,000
30,000
27,000
Other Fixed Costs
-16,000
-16,000
-16,000
Depreciation
-5,000
-5,000
-4,000
EBIT
15,000
9,000
7,000
Interest
-5,000
-5,000
-5,000
Earnings before Taxes
10,000
4.000
2,000
Taxes
-3,000
-1,200
-600
Net Income
7,000
2,800
1,400
Dividends
-3,500
-1,000
Retained Earnings
3,500
1,800
1,400
Statement of Financial Position:
Cash
16,700
7.000
3,100
Accounts Receivable
10,000
9,900
8,800
Inventory
3,000
3,300
3,000
Fixed assets
205,000
200,000
200,000
Total
234,700
220,200
214,900
Accounts Payable
18,000
15,000
13,500
Long-term Debt
105,000
102,000
100,000
Common Stock
105,000
100,000
100,000
Retained Earnings
6,700
3.200
1,400
Total
234,700
220,200
214,900
Days
2019
2018
Accounts Receivable
30
36
Inventory
13
17
Accounts Payable
-78
-78
Net days
-35
-25

Step-by-step answer

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Subject: Business, Finance

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