Statement of Cash Flows (Partial Operating Activities Problem: Hollywood Company reported net income of $775,000 for the current year. Depreciation recorded on buildings and equipment amounted to $160,000 for the year. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: Balance Sheet Amounts End of Year Beg of Year Increase (Decrease) Cash $85,000 $45,000 Accounts Receivable $62,000 $85,000 $40,000 ($23,000) ($22,000) ($15,000) Inventory $65,000 $45,000 $87,000 $60,000 Accounts Payable 19+ Instructions: Prepare the cash flows from the operating activities section of the statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) Hollywood Company Partial Statement of Cash Flows - Operating Activities Type correct description for statement Adjustments to reconcile net income to: Net cash provided by Operating Activities: Type correct description for adjustment Type correct description for adjustment Type correct description for adjustment Type correct description for adjustment Type correct description for statement Free Cash Flow Ratio Problem: Lucas Company had net sales for the year of $450,500, cost of goods sold of $145,500, net income of $65,400, net cash provided by operating activities of $115,000, net cash used by investing activities of $55,200, capital expenditures of $40,500, and cash dividends of $24,500 in dividends for the year. What is the free cash flow for the year? Instructions: Calculate the Free Cash Flow Ratio for Lucas Company. Free Cash Flow Ratio Corporate Life Cycle Problem: Instructions: 1: Enter the Net cash provided (used) for each business activity" from a public company's Statement of Cash Flows in 2020. Use the same company financial statements from your Ch7 case study assignment. 2: Identify the likely phase in the company's corporate life cycle. Net cash Net cash Net cash provided (Used) provided (Used) provided (Used) by Operating by Investing by Financing Activities Activities Activities Company (2020 Annual Report) Net Income Likely Phase in the Company's Corporate Life Cycle Type company's name Type Likely Phase in the Company's Life Cycle 2. Instructions for Posting (200 to 300 words - 60pts): a. Provide an explanation for a company's Growth Phase: 1- Describe a company's likely cash from operations in the growth phase. 2- Describe two different ways a company will likely make up for a cash dificiency when in the growth phase
