Question

Table 5: FINC300 Inc. Income Statement 2013

Sales	$7000
Less: Cost of goods sold	4000
Gross Profit	3000
Less: Operating expenses	-
Selling expenses	200
General and administrative expenses	400
Lease expenses	100
Depreciation expenses	80
Total operating expenses	780
Operating profits	2220
Less: Interest expenses	200
Net profit before taxes	2020
Less: Taxes (30%)	606
Net profit after taxes	1414
Less: Preferred stock dividends	20
Earnings available for common stockholders	1394
Less: Common stock dividends	894
Retained earnings	500

Table 6: FINC300 Inc. Balance Sheet

Assets	2013	2012	Liabilities and Stockholders' Equity	2013	2012
Current Assets			Current liabilities
Cash	980	600	Acct. payable	550	600
Account Receivable	800	1000	Notes payable	650	600
Inventory	500	600	Accruals	0	0
Total current assets	2280	2200	Long-term debt	2500	2000
			preferred stock	400	400
Total gross fixed assets	8000	7000	Common stock (600,000 shares)	1200	1200
Less: Accu. depreciation	4164.8	4084.8	Retained earnings	815.2	315.2
Net fixed assets	3835.2	2915.2	Total Stockholders' equity	2415.2	1915.2
Total assets	6115.2	5115.2	Total liabilities and stockholders' equity	6115.2	5115.2

Table 7: Cash Flow 2013

CF from Operating Activities
Net profits after taxes
Depreciation for the year
decrease in account receivable
decrease in inventories
increase in accounts payable
increase in accruals
CF provided by operating activities
CF from Investment Activities
Decrease in gross fixed assets
Changes in equity investment in other firms	0
CF provided from investment activities
CF from financing activities
Increase in notes payable
Increase in long-term debt
Changes in stockholders' equity
less Total dividend paid
CF provided by financing activities
Total cash added to reserve

Answer 1

CF from Operating Activities
Net profits after taxes	$1414
Depreciation for the year	$80
decrease in account receivable [1000-800]	$200
decrease in inventories [600-500]	$100
Decrease in accounts payable [600-550]	($50 )
Decrease in accruals	( $0)
CF provided by operating activities	$1744
CF from Investment Activities
Increase in gross fixed assets	($1000)
Changes in equity investment in other firms	0
CF provided from investment activities	($1000)
CF from financing activities
Increase in notes payable [650-600]	50$
Increase in long-term debt [2500-2000]	500$
Changes in stockholders' equity (no new common stock issued)]	0$
less Total dividend paid [20+894]	(914)
CF provided by financing activities	(364)
Total cash added to reserve	380$