Refer to PB1-1.
PB1-1
Assume that you are the president of APEC Aerospace Corporation. At the end of the first year of operations (December 31, 2012), the following financial data for the company are available:
Accounts Payable...................................... $33,130
Accounts Receivable......................................9,500
Cash....................................................... 13,900
Contributed Capital..................................... 10,000
Dividends...................................................1,100
Equipment................................................ 86,000
Notes Payable........................................... 51,220
Operating Expenses...................................... 60,000
Other Expenses............................................8,850
Sales Revenue............................................94,000
Supplies.....................................................9,000
Required:
1. Evaluate whether the company was profitable.
2. Evaluate whether the company could have paid a greater amount for dividends.
3. Evaluate whether the company is financed mainly by creditors or stockholders.
4. Determine the amount of cash increase or decrease that would be shown in the statement of cash flows.