Question

Choose the right answer

Use the following information to answer Questions 3 to 5.

Asha Inc.'s financial statements for its year ended December 31, 20X8, follow: Asha Inc. Statement of financial position as at December 31, 20X8

20X8 20X7

Assets

1. Cash and cash equivalent $94,000 $123,000
2. Accounts receivable (net) 114,000 111,500
3. FVOCI investments 15,000 12,000
4. Inventory 69,000 73,800
5. Prepaid expenses 15,000 11,700
6. Property, plant, and equipment (PPE), net 622,000 425,000
7. Trademark48,00063,000

$977,000 $820,000

Liabilities and shareholder equity

2. Accounts payable $62,100 $57,500
3. Income taxes payable 21,100 19,000
4. Dividends payable 15,000 18,000
5. Bank loan 295,300 215,600
6. Bonds payable210,000 212,000

`` $603,500 $522,100

1. Common shares $128,000 $121,000
2. Preferred shares 125,000 100,000
3. Accumulated other comprehensive income 17,000 18,000
4. Retained earnings103,500 58,900

$373,500 $297,900

$977,000 $820,000

Asha Inc. Statement of comprehensive income Year ended December 31, 20X8

Profit or loss

1. Sales revenue $1,250,000
2. Cost of goods sold522,000

Gross profit 728,000

2. Operating expenses $322,000
3. Interest expense 30,400
4. Depreciation expense 120,000
5. Impairment loss trademark 18,000
6. Gain on disposal of equipment(5,000)

$485,400

Profit or loss before tax 242,600

Income tax expense 92,300

Net income $150,300

Other comprehensive income

Holding loss on investment at FVOCI (1,000)

Other comprehensive income (1,000)

Comprehensive income $149,300

Other information:

Asha reports its financial results in accordance with IFRS. It elects to report interest and dividends received as investing activities and interest and dividends paid as financing activities

. Asha did not sell any investments at FVOCI during the year.

Asha issued $10,000 in preferred shares in exchange for equipment value at $10,000.

The bonds payable were previously issued at a premium; $2,000 of the premium was amortized in 20X8.

Asha expended money during the year successfully defending its trademark.

Equipment with a net book value of $16,000 was sold during the year.

3. What are Asha's net cash flows from investing activities for its year ended December 31, 20X8?

a) $305,000 outflow b) $306,000 outflow c) $309,000 outflow d) $314,000 outflow

4. What are Asha's net cash flows from financing activities for its year ended December 31, 20X8?

a) $29,400 outflow b) $36,400 outflow c) $37,400 outflow d) $39,400 outflow

5. .What are Asha's net cash flows from operating activities for its year ended December 31, 20X8?

a) $301,400 inflow b) $317,300 inflow c) $318,400 inflow d) $319,400 inflow