1. General Sales Corp. reports the following summary income statement for the year ended

12/31/2015:

Sales $520,000

Less: Cost of Goods Sold ($310,000)

Gross Profit $210,000

Less: Depreciation expense ($25,000)

Salaries expense ($65,000)

Other expenses ($56,000)

Net income $64,000

Also, General Sales reports the following non-cash balance sheet information re: working capital

12/31/2015 12/31/2014

Accounts Receivable $120,000 $124,000

Inventory $190,000 $170,000

Accounts Payable $85,000 $65,000

Salaries Payable $16,000 $20,000

REQUIRED: 1) Prepare the simultaneous analysis matrix for cash flows as previously illustrated in

homework and in-class exercises to calculate data for operating cash flows. (12 pts)

2) Prepare the Operating flows section of the Statement of Cash Flows using the direct approach (10 pts

3) Prepare the Operating flows section of the Statement of Cash Flows using the indirect approach (10

pts.)

2. A comparative balance sheet for Meyerson Industries is given below: Meyerson Industries Comparative Balance Sheet December 31, 2015 and 2014 Assets 2015 2014 Cash ........................................ $ 50,000 $ 20,000 Accounts receivable ......................... 100,000 92,000 Merchandise inventory ....................... 30,000 43,000 Land, buildings, and equipment .............. 325,000 200,000 Accumulated depreciation--buildings and equipment ................................. (75,000) (50,000) Total assets ............................ $430,000 $305,000 Liabilities and Stockholders' Equity Accounts payable ............................ $ 75,000 $ 85,000 Common stock ($25 par) ...................... 275,000 200,000 Paid-in capital in excess of par ............ 50,000 0 Retained earnings ........................... 30,000 20,000 Total liabilities and stockholders' equity $430,000 $305,000 Additional data from the company's records were: On July 1, 2015, exchanged 3,000 shares of common stock for equipment valued at $125,000. (3,000 sh common @ $25 par + $50,000 additional paid in capital.) No cash changed hands in this transaction. This equipment and the related equity effects are included in above totals for 2015. Net income per the 12/31/2015 income statement was $50,000. Depreciation expense deducted on the income statement was $25,000 and income tax expense was $10,000. On December 31, 2015, paid cash dividends of $40,000. Prepare a complete Statement of Cash Flows for Meyerson Industries for the year ended December 31, 2015, using the indirect method. Include any necessary supplemental disclosures. (18 points) Present value problems (points as marked): Advise you use Excel to solve. DEF Corp is issuing a new $1,000,000 bond issue with a five-year life, to be sold in $1,000 bond increments as of January 1. The face rate printed on each bond is 6% per annum (interest is to be paid semiannually on June 30 and Dec. 31 each year), but by the time the bond went to market, the going interest rate on similar investments has declined to 5%. What should be the asking price of each $1,000 bond? (8 points)