Using a cash flow statement explain why Ultra Cable Corporations cash balance has declined so precipitously this
Question:
Ultra Cable Corporation Statement of Cash Flows Current Year $ 100,000 Cash at beginning of current year Operating activity Net income 357,750 Plus: Depreciation Increase in accounts payable 197,500 225,000 Less: Increase in accounts receivable (850,000) (1,626,125) (1,695,875) Increase in inventory Net cash from operating activity Investment activity Fixed asset acquisitions Net cash from investment activity (1,975,000) (1,975,000) Financing activity Increase in notes payable Increase in long-term debt 1,125,000 2,565,700 (107,325) Dividends paid Increase in common stock Net cash from financing activity 3,583,375 Net decrease in Cash (87,500) Cash, end of current year 12,500
Step by Step Answer:
The statement of cash flows shows that the firm has invested heavily in accounts receivable invento...View the full answer
Related Video
Depreciation of non-current assets is the process of allocating the cost of the asset over its useful life. The cost of the asset includes the purchase price, any additional costs incurred to bring the asset to its current condition and location, and any other costs that are directly attributable to the asset. The useful life of the asset is the period over which the asset is expected to be used by the company. To calculate the depreciation, companies use different methods such as straight-line, declining-balance, sum-of-the-years\'-digits, units-of-production, and group depreciation. The chosen method will depend on the type of asset, the company\'s accounting policies, and the accounting standards that are applicable. The straight-line method allocates an equal amount of the asset\'s cost over its useful life, while the declining-balance method calculates depreciation at a fixed rate, typically double the straight-line rate, but the amount of depreciation decreases over time. The sum-of-the-years\'-digits method is similar to the declining-balance method, but the rate of depreciation is calculated using a fraction that is based on the useful life of the asset. It\'s important to note that the depreciation expense will be recorded on the company\'s income statement and the accumulated depreciation will be recorded on the company\'s balance sheet. This will decrease the value of the asset on the balance sheet over time.
Students also viewed these Business questions
-
The financial statements of Wetaskiwin Ltd., a private company reporting under ASPE, follow: Additional information: 1. Short-term notes receivable are from loans to other companies. During the year,...
-
Using a cash flow statement for the most recent year, explain how Greg would sum up the companys cash position.
-
Depreciation and Cash Flow Ohare Companys only asset as of January 1, 2010, was a limousine. During 2010, only the following three transactions occurred: Services of $100,000 were provided on...
-
93) Clay of the Land is a manufacturer of glazed clay pots. Currently, it produces 300 clay pots per month which it sells through nurseries at a constant price of $5 per pot. Current demand for clay...
-
To apply the sign test, do you need independent or dependent (matched pair) data?
-
The Greek Connection had sales of $32 million in 2012, and a cost of goods sold of $20 million. A simplified balance sheet for the firm appears below: a. Calculate The Greek Connections net working...
-
What is the basic idea behind the finite element method?
-
The Farm-4-Less Tractor Company produces a grain combine (GC) in addition to both a large (LT) and small size tractor (SM). Its production manager desires to produce to customer demand using a mixed...
-
5. A uniform piece of sheet metal 30 cm on a side is cut to produce the following shape. Each of the squares making up the new shape has the same mass. Locate the coordinates of the centre of mass of...
-
ABC Framing has been hired to frame a light commercial building. The project began on July 2 and was completed on August 9. The following is a list of accounting transactions associated with the...
-
Consider a random walk as described in Example 9.13. After one million steps, find the probability that the walk is within 500 steps from the origin.
-
Let X Gamma(a, ), where a is a large integer. Without doing any calculations, explain why X Norm(a/, a/ 2 ).
-
Betty Shriver is the owner of Bettys Treasures, a small shop that sells collectible porcelain figurines and collectible pottery. Bettys shop carries many items that she purchased from estate sales...
-
1. Given a five year, 8% coupon bond with a face value of $1,000 and coupon payments made annually: a. What is the bond value if it is trading at the yield of 6%? b. What is the bond value if it is...
-
Calculate the amount of Economic Capital for Net Profit on a 95% confidence level assuming a normal distribution, rounded to the nearest ($'000). a. 51,000 b. 23,486 C. 75,634 d. 70,458 e. 39,150
-
Consider a 345-kV transmission line with the series inductance per-unit length of wL = 0.4560/km and shunt capacitance per-unit length of wC = 4.123uU/km. [20 points] a) Calculate the surge impedance...
-
from 4pm to 4:45p X YouTube Maps MACQUARIE A BUSINESS SCHOOL 5 of ilearn.mq.edu.au/mod/quiz/attempt php?attempt=10902632&cmid-7245252 Eon Examine the below graph of Tesla's share price. Tesla Inc...
-
Determine, by calculations, i) the location of the mass center, G., in units of in, ft, and m. The beam has 7 holes as shown and the diameter of each hole is 5/8". With the beam in the upright...
-
Evaluate the definite integral e* dx. 0.
-
To balance the chemical equation SiH3 + O2 SiO2 + HO, you could introduce coefficients a, b, c, d and write aSiH3 + bO2 cSiO + dHO then write linear equations for each element. The equation for Si...
-
1. What is the basic nature of the problem in this case? 2. What are the cash flows associated with the semiautomated machines? 3. What discount rate did you use? What DCF did you get? 4. Are you...
-
1. What is your assessment of Calaveras Vineyards, and what should Anne Clemens do? 2. What is the estimated value of Calaveras? 3. Would Calaveras be a creditworthy borrower? 4. What should Anne...
-
1. What is Colecos financial condition, and how did it come about? 2. At this point, who are the significant players in any potential outcome? What are their motivations? 3. What are managements...
-
Suppose the amounts presented here are basic financial information (in millions) from the 2025 annual reports of Nike an Nike adidas Sales revenue $18,455.5 10,493.0 Allowance for doubtful accounts,...
-
You can afford a $250 per month car payment. You\'ve found a 5year loan at 5% interest. How big of a loan can you afford?
-
When Karina was 6 years old, her parents started depositing $1,200 every three months into an account in Bank Mitch that pays interest at the rate of 1.75%/year compounded quarterly until she gets...
Study smarter with the SolutionInn App