2. Given the financial information for the A.F Neuman Corporation: (a) Prepare a statement of cash flows for the year ended December 31, 2010. (b) What is the dividend payout ratio for 2010? (c) If we increased the dividend payout ratio to 100%, what would happen to retained earnings at year end 2010? A. F. Neuman Corporation-Year-end Balance Sheets Assets 2009 2010 Cash Marketable Securities Accounts Receivable Inventories Investments 45,000 175,000 140,000 230,000 170,000 50,000 160,000 110,000 375,000 55,000 $1,500,000 450,000 Plant and Equipment Less Accumulated Depr Net Plant and Equipment850,000 Total Assets $1,750,000 600,000 950,000 $1,900,000 $1,810,000 LIABILITIES AND STOCKHOLDERS EQUITY Accounts Payable Notes payable Accrued Expenses Income Taxes Payable Bonds Payable Common Stock (10,000 shares, $1 Par) Retained Earnings Total Liabilities & Stockholder Equity 2009 2010 $110,000 150,000 80,000 10,000 860,000 100,000 400,000 $ 85,000 140,000 35,000 15,000 955,000 100,000 470,000 $1,900,000 2. Given the financial information for the A.F Neuman Corporation: (a) Prepare a statement of cash flows for the year ended December 31, 2010. (b) What is the dividend payout ratio for 2010? (c) If we increased the dividend payout ratio to 100%, what would happen to retained earnings at year end 2010? A. F. Neuman Corporation-Year-end Balance Sheets Assets 2009 2010 Cash Marketable Securities Accounts Receivable Inventories Investments 45,000 175,000 140,000 230,000 170,000 50,000 160,000 110,000 375,000 55,000 $1,500,000 450,000 Plant and Equipment Less Accumulated Depr Net Plant and Equipment850,000 Total Assets $1,750,000 600,000 950,000 $1,900,000 $1,810,000 LIABILITIES AND STOCKHOLDERS EQUITY Accounts Payable Notes payable Accrued Expenses Income Taxes Payable Bonds Payable Common Stock (10,000 shares, $1 Par) Retained Earnings Total Liabilities & Stockholder Equity 2009 2010 $110,000 150,000 80,000 10,000 860,000 100,000 400,000 $ 85,000 140,000 35,000 15,000 955,000 100,000 470,000 $1,900,000