Adjusting Operating Cash Flows Greenbow reported cash provided by operations of $175,000 and an increase in its cash balance from $90,000 to $210,000 during the year. In reviewing Greenbow’s financial statements you discover the following:

1. Payments to suppliers were reduced by $200,000 for the current year as the result of a one-time saving from adopting a new inventory control system.

2. A major customer was forced to delay payment of

$310,000 from November until January due to a strike by its employees. The customer is expected to resume paying promptly for all purchases starting in January.

3. Greenbow did not pay a dividend to its preferred shareholders during the current year. The preferred stock is cumulative and pays an annual dividend of $30,000.

Greenbow plans to pay a dividend of $80,000 to its common shareholders next year.

4. Greenbow decided to change the depreciable lives of its long-term assets from 15 years to 20 years at the start of the year. The annual reduction in depreciation expense is expected to be $82,000.

a. What effect did each of these have on Greenbow’s cash flow from operations or other cash flows reported in the cash flow statement in the current period?

b. What would you project Greenbow’s cash generated from operations to be for next year if all other operating results are same as this year?