(1)
Introduction:
Cash flow statements are the statements that determine the inflow and outflow of cash from three major activities that are carried out in a business, i.e., operating activities, investing activities and financing activities.
To state:
Company’s cash flow statement is prepared under direct method or indirect method.
(2)
Introduction:
Cash flow from operating activities calculates the inflow and outflow of cash from day-to-day activities. It includes operating income and operating expenses for the year.
To identify:
The amount of cash provided by operating activities and cash paid for dividends for the fiscal year 2017, 2016 and 2015.
(3)
Introduction:
Cash flow from operating activities calculates the inflow and outflow of cash from day-to-day activities. It includes operating income and operating expenses for the year.
To state:
Whether the company had enough cash flows from operations to pay the dividends in 2017.
(4)
Introduction:
Cash flow from financing activities calculates the inflow and outflow of cash from issue of shares and debentures and long term-borrowings or repayment of loan and redemption of debentures
To state:
If the company spend more or less cash to repurchase common stock in 2017 versus 2016.
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Managerial Accounting
- How do Cramer’s accrued liabilities affect the company’s statement of cash flows for2018?a. They increase cash used by financing activities.b. They increase cash provided by operating activities.c. They increase cash used by investing activities.d. They don’t because the accrued liabilities are not yet paidarrow_forwardUse the following excerpts from Bolognese Companys statement of cash flows and other financial records to determine the companys free cash flow for 2018 and 2017.arrow_forwardStatement of Cash Flows—Direct Method Lang Company has not yet prepared a formal statement of cash flows for 2016. Following are comparative balance sheets as of December 31, 2016 and 2015, and a statement of income and retained earnings for the year ended December 31, 2016: Required For purposes of a statement of cash flows, are the U.S. Treasury bills cash equivalents? If not, how should they be classified? Explain your answers. Prepare a statement of cash flows for 2016 using the direct method in the Operating Activities section.arrow_forward
- Analyzing Starbuckss Income Statement and Cash Flow Statement Disclosures Review Starbuckss financial statements and notes in Appendix A. Required: (Note: You do not need to make any calculations.) 1. Does the company use a multiple-step or a single-step format on its income statement? Explain. 2. What was the net earnings attributable to Starbucks for 2017? What was the basic earnings per common share for 2017? 3. What was the amount of the income taxes related to income before income taxes for 2017? 4. What was the amount of general and administrative expenses in 2017? 5. What amount of depreciation and amortization expense is reported separately on the income statement for 2017? How much depreciation and amortization expense is added back to net income on the 2017 statement of cash flows? What item on the income statement includes the majority of the difference? 6. What amount of dividends on common stock was paid and declared in 2017? If these amounts differ, where is the difference on the balance sheet? 7. Are Starbuckss revenues seasonal? If so, in which two quarters did Starbucks generate the most revenues in 2016 and 2017? 8. Did Starbucks use the direct or indirect method to determine the net cash provided by operating activities in 2017? What was the amount? 9. What was the net cash used in investing activities in 2017? 10. What cash was used for financing activities in 2017?arrow_forward3. What is the amount debited to accumulated profits as a result of the 2016 cash dividend declaration? 4. What is the correct balance of the accumulated profits-unappropriated account as of December 31, 2016?arrow_forwardCalculate free cash flow for 2017 for Monarch Textiles, Inc., based on the financial information that follows. Assume that all current liabilities are non-interest-bearing liabilities and that no fixed assets were sold or disposed of during 2017. (Round your answer to 1 decimal places.) Sales Cost of sales Income statement Operating expenses Depreciation Interest expense Earnings before taxes Tax Net income Free cash flow Monarch Textiles, Inc. ($ thousands) 2017 1,280 760 130 62 50 278.00 111.20 166.80 X Answer is complete but not entirely correct. $ 140.9 Selected balance sheet items Current assets Net fixed assets Current liabilities 2016 360 124 230 2017 490 248 310arrow_forward
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