Analysis of cash flow

Change in A/R = -22000

Cost of Goods sold = -150000

Change in inventory = -3500

Change in A/P = 3000

Operating Expenses = -19000

Change in Accruals and others = 2000

Taxes Paid = 1500

Interest Expense = -3500

Dividends = -500

Current maturities = 0

Capital Expenditures = -23000

Change in short-term debt = 3500

Change in long-term debt = 13000

Change in equity = 0

choose the best answer

a) ABC's capital expenditures were funded mostly by long-term debt

b) ABC needed to use short-term debt to support the growth in receivables and inventory

c) ABC's operating cash flow was sufficient to cover its investing activities

d) ABC used short-term debt to cover a portion of its interest expense

Answer rating: 100% (QA)

As per the given data Option A is correct Reason As the capit... View the full answer