Top managers of Bayside Inns are reviewing company performance for 2014. The income statement reports a 20% increase in net income over 2013. However, most of the increase resulted from a gain on insurance proceeds from fire damage to a building. The balance sheet shows a large increase in receivables. The cash flows statement, in summarized form, reports the following:
Net cash used for operating activities ...................... $(63,500)
Net cash provided by investing activities ................. 42,000
Net cash provided by financing activities ................ 29,100
Increase in cash during 2014 ................................... $ 7,600
Write a memo giving Bayside Inns’ managers your assessment of 2014 operations and your outlook for the future. Focus on the information content of the cash flows data.