Create a cash flow statement from the given income statement and balance sheet.

Question

Create a cash flow statement from the given income statement and balance sheet.

Powell Panther Corporation: Balance Sheets as of December 31 (Millions of Dollars) 2016 2015 Assets Cash and equivalents Accounts receivable Inventories 12.0 180.0 180.0 $372.0 3000 $672.0 10.0 150.0 200.0 360.0 250.0 610.0 Total current assets Net plant and equipment Total assets Liabilities and Equity Accounts payable Accruals Notes payable $108.0 72.0 67.0 $247.0 150.0 397.0 50.0 225.0 $275.0 $672.0 90.0 60.0 51.5 $201.5 1500 3515 500 208.5 $258.5 $610.0 Total current liabilities Long-term bonds Total liabilities Common stock (50 million shares) Retained earnings Common equity Total liabilities and equity

Explanation / Answer

Cash Flow Statement of Powell Panther Corporation (Amount in Million of Dollars)

NOTES :

1. Plant & Equipment

2. Dividend Paid During the year

Particulars Amount Amount 1) CASH FLOW FROM OPERATING ACTIVITIES Earnings before interest & tax 150 Add: Depreciation & Ammortization 30 Changes in Working Capital Add: Increase in Accounts Payable (108-90) 18 Increase in Accruals (72-60) 12 Increase in Notes Payable (67-51.5) 15.5 Decrease in Inventories (180-200) 20 Less: Increase in Accounts Receivable (180-150) (30) Cash Flow from Operating Activities 215.5 Less: Taxes Paid (51.3) Net Cash Flow From Operating Activities (A) 164.2 2) CASH FLOW FROM INVESTING ACTIVITIES Purchase of Plant & Equipment (Note 1) (80) Net Cash Flow from Investing Activities (B) (80) 3) CASH FLOW FROM FINANCING ACTIVITIES Interest paid during the year (Note 2) (21.7) Dividend Paid during the year (60.5) Net Cash Flow from Financing Activities (C) (82.2) Net increase in cash & cash equivalent (A+B+C) 2 Add: Opening Balance of Cash & Cash Equivalent 10 Closing balance of Cash & Cash Equivalent 12

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