Problem 1(16 Marks) Consider the following financial statements for Athabasca Inc. Balance Sheet 2017 Current assets $5.000 $6.500 30,000 $31.00 400 S43. $75.000000 Accounts receive Inventory Total Fixed assets Net plant and equipment Total assets 375.000393.790 S450.000 47.75 Liabilities and Owners |Equity Current liabilities Accounts payable Notes payable 550.000 553.750 25.000 $26.250 575.000 $0.00 SR5 000 589 250 Long-term debi Owners' equity Common stock Accumulated retained camins Total Total liabilities and owners! $60.000 $63.000 230.000 41.500 5290.000 3040 450.0005473,50 Income Statement for 2018 Sales cogs Depreciation EBIT interest EBT Taxes (45%) Net income S400.000 200.000 30.000 $170,000 15 SI55.000 69.750 S85.250 a. Please prepare a statement of cash flows for Athabasca Inc. for year 2018. (8 Marks) b. Using the information given determine whether the firm is likely to be prone to financial distress during bad economic times. Please make use of the information related to the firm's capital structure. (2 Marks) c. Calculate the Cash Flow from Assets (CFFA). Does the CF identity hold? (6 Marks) Problem 1(16 Marks) Consider the following financial statements for Athabasca Inc. Balance Sheet 2017 Current assets $5.000 $6.500 30,000 $31.00 400 S43. $75.000000 Accounts receive Inventory Total Fixed assets Net plant and equipment Total assets 375.000393.790 S450.000 47.75 Liabilities and Owners |Equity Current liabilities Accounts payable Notes payable 550.000 553.750 25.000 $26.250 575.000 $0.00 SR5 000 589 250 Long-term debi Owners' equity Common stock Accumulated retained camins Total Total liabilities and owners! $60.000 $63.000 230.000 41.500 5290.000 3040 450.0005473,50 Income Statement for 2018 Sales cogs Depreciation EBIT interest EBT Taxes (45%) Net income S400.000 200.000 30.000 $170,000 15 SI55.000 69.750 S85.250 a. Please prepare a statement of cash flows for Athabasca Inc. for year 2018. (8 Marks) b. Using the information given determine whether the firm is likely to be prone to financial distress during bad economic times. Please make use of the information related to the firm's capital structure. (2 Marks) c. Calculate the Cash Flow from Assets (CFFA). Does the CF identity hold? (6 Marks)