2. Given the information that follows for Double Trouble, Inc., compute: a. The Cash Flow from Assets for year ended December 31, 2016 is -$1910. Show the calculations necessary to arrive at that conclusion. Note: There are some accounting treatments that would handle notes payable differently in these calculations. However, since our textbook does the calculations using current liabilities, as listed on the statement, we will do the same. Note also that Bonds Payable are the only long term liabilities. b. Compute cash flows to stockholders and to creditors ended December 31, 2016. Balance Sheet Assets Cash Double Trouble, Inc. 12/31/15 and 12/31/16(5000) Accounts receivable Inventory Current assets 12/31/15 12/31/16 5,100 4,450 9,150 9,700 11,500 12.050 $25,750 $26,200 Plant and equipment 72,500 83,450 Accumulated depreciation 20,000 23,950 Net plant and equipment i 52,500 59,500 Total assets $78,250 $85,700 Liabilities and Owners' Equity 12/31/15 12/31/16 Account payable 3,250 4,200 Accrued expenses 1,000 1,200 Notes payable-current (9%) 10,000 4,550 Current liabilities 14,250 9,950 Bonds Payable 21,000 28,250 Owners' equity Common stock 31,750 30000 Retained earnings 11,250 17500 Total owners' equity Total liabilities & owners' equity 43,000 47,500 $78,250 $85,700 12/31/15 and 12/31/16(5000) 2015 2016 Sales $27,000 $37,000 Cost of goods sold 10,800 14,800 Gross profit 16,200 22,200 Operating expenses 5,000 6,900 Net operating income 11,200 15,300 Interest expense 1,500 1,650. Net income before taxes 9,700 13,650 Taxes (40%) 3,880 5,460 Net income $ 5,820 $8,190 Includes deprec. expense of 2,200 3,770 ii) Primary sources of cash were operations and the sale of bonds. A small increase in accounts payable also provided some cash. The primary uses of cash were fixed assets, notes, dividend and interest expense.