A) Prepare a statement of cash flows for the year ended December 31, 2015, organized by cash flow from operating activities, cash flow from investment activities, and cash flow from financing activities.

Based on your calculations above, answer the following:

B) How much did the Net Operating Working Capita Investment (NOWC) of the firm change from 2014 to 2015?

C) Did the company acquire or dispose of assets in net terms? How much?

D) What activities of the companies generated cash (if any), and what activities burned cash (if any)?

D) How much dividends did the company pay in 2015?

E) Verify that CF Operations + CF From Investing + CF From Financing = Change in Cash Balance

The credit manager at First National Bank has just received the income statement and balance sheet for Magna Fax, Inc. for the year ended December 31,2015. (See Table 4.2 below) The bank requires the firm to report its earnings performance and financial position quarterly as a condition of a loan agreement. The bank's credit manager must prepare two key financial statements based on the information sent by Magna Fax, Inc. This will be passed on to the commercial loan officer assigned to this account, so that he may review the financial condition of the firm. Income Statement For the Year Ended December 31, 2015 \begin{tabular}{|c|c|c|} \hline Sales revenue & & $150,000 \\ \hline Cost of goods sold & & 117,500 \\ \hline Gross profits & & $32,500 \\ \hline Selling expense & 4,500 & \\ \hline General and administrative expense & 4,000 & \\ \hline Depreciation expense & 4,000 & \\ \hline Operating profits & & $20,000 \\ \hline Interest expense & & 2,500 \\ \hline Net profit before taxes & & $17,500 \\ \hline Taxes (40%) & & 7,000 \\ \hline Net profit after taxes & & $10,500 \\ \hline \end{tabular} Magna Fax, Inc. Balance Sheet For the Years Ended December 31, 2014 and 2015 \begin{tabular}{|c|c|c|c|} \hline & 2015 & & 2014 \\ \hline \multicolumn{4}{|l|}{ Assets } \\ \hline Cash & $24,000 & & $21,000 \\ \hline Accounts receivable & 45,000 & & 39,000 \\ \hline Inventory & 30,000 & & 27,000 \\ \hline Gross fixed assets & $42,000 & $40,000 & \\ \hline Acc. Depreciation & 22,000 & 18,000 & \\ \hline Net fixed assets & 20,000 & & 22,000 \\ \hline Total assets & $119,000 & & $109,000 \\ \hline \multicolumn{4}{|l|}{ Liabilities and Equity } \\ \hline Accounts payable & $25,000 & & $30,000 \\ \hline Notes payable & 50,000 & & 40,000 \\ \hline Accruals & 1,000 & & 2,000 \\ \hline Long-term debts & 10,000 & & 8,000 \\ \hline Common stock at par & 1,000 & & 1,000 \\ \hline Paid-in capital in excess of par & 4,000 & & 4,000 \\ \hline Retained earnings & 28,000 & & 24,000 \\ \hline Total liabilities and equity & $119,000 & & $109,000 \\ \hline \end{tabular}