Answer the Following Questions

(Question 1)

The Travel Corporation is a canoe manufacturer. The company is very well established in Northern Ontario. The company has been in business for 20 years. The business is family owned and operated. The last fiscal year of 2022 provided the following cash flow statement section totals:

Travel Corporation Cash Flow Statement For 2022

Cash Flow Section

Cash From Operations$400,000

Cash From Financing Activities$200,000

Cash Used In Investing Activities$(400,000)

Required

a) During the last fiscal year of 2022, there was depreciation expense of $50,000 and accumulated depreciation of $200,000. Identify the cash flow section, if any, you would you see the depreciationexpense and accumulated depreciation. Explain why depreciation is added back when calculating the totalcash flow for the year.

b) If the company had $50,000 in cash at the end of 2021, calculate the cash at the end of 2022.

b) During 2022, The Travel Corporation borrowed a net amount of $200,000 from the Bank to purchaseproperty for $400,000. Explain if the business should have borrowed more or less funds.

(Question 2)

The Desk Company manufactures office desks in Toronto, Ontario. The company has raised $1,000,000 from an issue of common shares. The company paid off a long-term bank loan of $200,000. The company then purchased property for $1.5 million and borrowed $500,000 by way of a Bank mortgage that is to be repaid in 10 years. The company sold surplus property that was not being used for $200,000.

Required

a) Calculate the cash used or cash from investingactivities. Explain the reasoning why a company may prefer financing by way of issuing common shares versus by borrowing from a Bank.

Please explain fully with all calculations and table.