2 Understanding Financial Statements and Cash Flow PART CHAPTER CASE Cash Flows and Financial Statements at Sunset Boards, In 2015 $203,963 $257 52 and sells surfboards in Malibu. Tad Marks. the founder of the company, is in charge of the design and sale of the surfboards, but his background is in surfing not business. As a result, the company's financial re cords are not well maintained. unset Boards is a small company that Cost of goods sold 57,576 65.07 12,530 14,345 40.110 52.351 nterest expecministrative Selling and administrative The initial investment in Sunset Boards was pro- vided by Tad and his friends and family. Because the ni Accounts payable tial investment was relatively small, and the company has made surfboards only for its own store, the investors haven't required detailed financial statements from Tad. But thanks to word of mouth among professional s ers, sales have picked up recently, and Tad is consider ing a major expansion. His plans include opening another surfboard store in Hawai, as well as supplying his 'sticks" (surfer lingo for boards) to other sellers. 52,015 57,708 254,017 316825 400,111 487,712 20,854 27050 23,708 25,885 128,218 143.971 Net flxed assets Accounts receivable urf- Long-term debt Inventory 43,884 60,222 Sunset Boards currently pays out 50 percent of net ment, which he plans to finance with a combination of come as dividends to Tad and the other original imes additional funds from outsiders plus some money bor- Tad's expansion plans require a significant invest- tors, and has a 20 percent tax rate, You are Jamesons rowed from banks. Naturally, the new investors and assistant, and he has asked you to prepare the statements than Tad has previously prepared. At the 1. An income statement for 2015 and 2016 urging of his investors, Tad has hired financial analyst A balance sheet for 2015 and 2016. Operating cash flow for each year. 2. on Reid to evaluate the performance of the com 3. pany over the past year After rooting through old bank statements, sales re- ceipts, tax returns, and other records, Jameson has as- sembled the following information 4. Cash flow from assets for 2016. 5. 6. Cash flow to creditors for 2016. Cash flow to stockholders for 2016. QUESTIONS flows for 2016? Write a brief discussion in light of your discussion in the previous qu 2 Understanding Financial Statements and Cash Flow PART CHAPTER CASE Cash Flows and Financial Statements at Sunset Boards, In 2015 $203,963 $257 52 and sells surfboards in Malibu. Tad Marks. the founder of the company, is in charge of the design and sale of the surfboards, but his background is in surfing not business. As a result, the company's financial re cords are not well maintained. unset Boards is a small company that Cost of goods sold 57,576 65.07 12,530 14,345 40.110 52.351 nterest expecministrative Selling and administrative The initial investment in Sunset Boards was pro- vided by Tad and his friends and family. Because the ni Accounts payable tial investment was relatively small, and the company has made surfboards only for its own store, the investors haven't required detailed financial statements from Tad. But thanks to word of mouth among professional s ers, sales have picked up recently, and Tad is consider ing a major expansion. His plans include opening another surfboard store in Hawai, as well as supplying his 'sticks" (surfer lingo for boards) to other sellers. 52,015 57,708 254,017 316825 400,111 487,712 20,854 27050 23,708 25,885 128,218 143.971 Net flxed assets Accounts receivable urf- Long-term debt Inventory 43,884 60,222 Sunset Boards currently pays out 50 percent of net ment, which he plans to finance with a combination of come as dividends to Tad and the other original imes additional funds from outsiders plus some money bor- Tad's expansion plans require a significant invest- tors, and has a 20 percent tax rate, You are Jamesons rowed from banks. Naturally, the new investors and assistant, and he has asked you to prepare the statements than Tad has previously prepared. At the 1. An income statement for 2015 and 2016 urging of his investors, Tad has hired financial analyst A balance sheet for 2015 and 2016. Operating cash flow for each year. 2. on Reid to evaluate the performance of the com 3. pany over the past year After rooting through old bank statements, sales re- ceipts, tax returns, and other records, Jameson has as- sembled the following information 4. Cash flow from assets for 2016. 5. 6. Cash flow to creditors for 2016. Cash flow to stockholders for 2016. QUESTIONS flows for 2016? Write a brief discussion in light of your discussion in the previous qu