ACCOUNTING (LOOSELEAF)-W/STD.GDE+ACCESS
27th Edition
ISBN: 9781337692298
Author: WARREN
Publisher: CENGAGE L
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Chapter 16, Problem 16.3CP
To determine
Statement of cash flows:
Statement of cash flow is a financial statement that shows the cash and cash equivalents of a company for a particular period of time. It shows the net changes in cash, by reporting the sources and uses of cash as a result of operating, investing, and financing activities of a company.
Cash flows from investing activities:
Cash provided by or used in investing activities is a section of statement of cash flows. It includes the purchase or sale of equipment or land, or marketable securities, which is used for business operations.
Cash flows from financing activities:
Cash provided by or used in financing activities is a section of statement of cash flows. It includes raising cash from long-term debt or payment of long-term debt, which is used for business operations.
Cash flows from operating activities:
These refer to the cash received or cash paid in day-to-day operating activities of a company. In this direct method, cash flow from operating activities is computed by using all cash receipts and cash payments during the year.
To Write: A brief memo to the instructor evaluating the financial condition of Incorporation T.
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Multiple Choice
37.5%
25.0%
33.3%
42.9%
Financial Information for Powell Panther Corporation is shown below:
Powell Panther Corporation: Income Statements for Year Ending December 31 (millions of dollars)
Sales
Operating costs excluding depreciation and amortization
EBITDA
Depreciation and amortization
Earnings before interest and taxes (EBIT)
Interest
Assets
Cash and equivalents
Accounts receivable
Inventories
Total current assets
Net plant and equipment
Total assets
Liabilities and Equity
Accounts payable
Accruals
Earnings before taxes (EBT)
Taxes (25%)
Net Income
Common dividends
Powell Panther Corporation: Balance Sheets as of December 31 (millions of dollars)
2020
2021: $
b. What was the 2021 free cash flow?
2021
$3,300.0
2,805.0
$495.0
$
2020
$3,000.0
2,550.0
$450.0
72.0
$378.0
66.0
$312.0
124.8
$187.2
$181.6 $149.8
-Select-
86.0
$ 409.0
72.6
$ 336.4
134.6
$201.8
2021
50.0 $
483.0
725.0
$1,258.0
864.0
$2,122.0
$264.0
225.0
Notes payable
66.0
Total current liabilities
$ 555.0
Long-term bonds
660.0
Total liabilities…
Cash Flow RatiosSpencer Company reports the following amounts in its annual financial statements:
Cash flow from operating activities
$90,000
Â
Capital expenditures
$59,500*
Cash flow from investing activities
(68,000)
Â
Average current assets
136,000
Cash flow from financing activities
(8,500)
Â
Average current liabilities
102,000
Net income
42,500
Â
Total assets
255,000
* This amount is a cash outflowa. Compute Spencer's free cash flow.b. Compute Spencer's operating-cash-flow-to-current-liabilities ratio.c. Compute Spencer's operating-cash-flow-to-capital-expenditures ratio.
Round ratios to two decimal points.
a. Free cash flow
Answer
b. Operating-cash-flow-to-current-liabilities ratio
Answer
c. Operating-cash-flow-to-current-expenditures ratio
Answer
Chapter 16 Solutions
ACCOUNTING (LOOSELEAF)-W/STD.GDE+ACCESS
Ch. 16 - Prob. 1DQCh. 16 - Prob. 2DQCh. 16 - A corporation issued 2,000,000 of common stock in...Ch. 16 - A retail business, using the accrual method of...Ch. 16 - Prob. 5DQCh. 16 - A long-term investment in bonds with a cost of...Ch. 16 - A corporation issued 2,000,000 of 20-year bonds...Ch. 16 - Fully depreciated equipment costing 50,000 is...Ch. 16 - Prob. 9DQCh. 16 - Name five common major classes of operating cash...
Ch. 16 - Prob. 16.1APECh. 16 - Prob. 16.1BPECh. 16 - Adjustments to net incomeindirect method Ripley...Ch. 16 - Prob. 16.2BPECh. 16 - Changes in current operating assets and...Ch. 16 - Changes in current operating assets and...Ch. 16 - Prob. 16.4APECh. 16 - Prob. 16.4BPECh. 16 - Land transactions on the statement of cash flows...Ch. 16 - Land transactions on the statement of cash flows...Ch. 16 - Prob. 16.6APECh. 16 - Prob. 16.6BPECh. 16 - Cash payments for merchandisedirect method The...Ch. 16 - Cash payments for merchandisedirect method The...Ch. 16 - Prob. 16.8APECh. 16 - Prob. 16.8BPECh. 16 - Prob. 16.1EXCh. 16 - Effect of transactions on cash flows State the...Ch. 16 - Classifying cash flows Identify the type of cash...Ch. 16 - Cash flows from operating activitiesindirect...Ch. 16 - Cash flows from operating activitiesindirect...Ch. 16 - Prob. 16.6EXCh. 16 - Prob. 16.7EXCh. 16 - Determining cash payments to stockholders The...Ch. 16 - Reporting changes in equipment on statement of...Ch. 16 - Prob. 16.10EXCh. 16 - Reporting land transactions on statement of cash...Ch. 16 - Prob. 16.12EXCh. 16 - Reporting land acquisition for cash and mortgage...Ch. 16 - Reporting issuance and retirement of longterm debt...Ch. 16 - Prob. 16.15EXCh. 16 - Prob. 16.16EXCh. 16 - Prob. 16.17EXCh. 16 - Statement of cash flowsindirect method The...Ch. 16 - Prob. 16.19EXCh. 16 - Prob. 16.20EXCh. 16 - Determining selected amounts for cash flows from...Ch. 16 - Prob. 16.22EXCh. 16 - Cash flows from operating activitiesdirect method....Ch. 16 - Prob. 16.24EXCh. 16 - Free cash flow The financial statement for Nike,...Ch. 16 - Free cash flow Lovato Motors Inc. has cash flows...Ch. 16 - Statement of cash flowsindirect method The...Ch. 16 - Prob. 16.2APRCh. 16 - Statement of cash flowsindirect method The...Ch. 16 - Prob. 16.4APRCh. 16 - Prob. 16.5APRCh. 16 - Prob. 16.1BPRCh. 16 - Statement of cash flowsindirect method The...Ch. 16 - Statement of cash flowsindirect method The...Ch. 16 - Statement of cash flowsdirect method The...Ch. 16 - Statement of cash flowsdirect method applied to PR...Ch. 16 - Ethics in Action Lucas Hunter, president of...Ch. 16 - Prob. 16.3CPCh. 16 - Using the statement of cash flows You are...Ch. 16 - Dillip Lachgar is the president and majority...
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