The 2008 balance sheet of Nick\'s Tennis Shop, Inc., showed long-term debt of $2
ID: 2812778 • Letter: T
Question
The 2008 balance sheet of Nick's Tennis Shop, Inc., showed long-term debt of $2.25 million, and the 2009 balance sheet showed long-term debt of $3.95 million. The 2009 income statement showed an interest expense of $280,000. What was the firm's cash flow to creditors during 2009?
Multiple Choice
$1,700,280
$-281,700
$-278,300
$1,700,000
$-1,420,000
The 2008 balance sheet of Nick's Tennis Shop, Inc., showed long-term debt of $2.25 million, and the 2009 balance sheet showed long-term debt of $3.95 million. The 2009 income statement showed an interest expense of $280,000. What was the firm's cash flow to creditors during 2009?
Explanation / Answer
Hence, correct option is $-1,420,000
Cash flow to creditors = Interest - Net new LTD =280000-(3950000-2250000) Cash flow to creditors -1420000Related Questions
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