The Stadlers are a middle-class family living comfortably in a single-family home in a suburb of Vancouver. Mr. and Mrs. Stadler earn a decent family income, bringing home almost $65,000 after taxes and other deductions. They have two active school-age children. The Stadlers have come to you to assess their family’s financial situation. As a starting point you decide to look at their cash flow for 2017. You organize the information they provided you into the traditional cash flow statement format shown below
Stadler Family
Cash Flow Statement for 2017
Cash from operations
Cash received in salaries......... $64,275
Cash spent on household activities..... (48,750)
Cash spent on vacations......... (3,200)
Cash spent on children and their activities.... (15,900)
......... ......... .. (3,575)
Financing activities
Payments on mortgage (including interest) .. (9,650)
Bank loan.................. 15,000
Second mortgage............ 12,500
Borrowing from parents........... 5,000
..................... 22,850
Investing activities
Home renovations............. (4,825)
New car.................. (16,750)
Savings.................. (500)
......... ......... ... (22,075)
Increase in cash during the year......... (2,800)
Cash at the beginning of the year....... 3,290
Cash at the end of the year......... $ 490

Required:
Prepare a report analyzing the Stadler’s cash flow statement. How do you think the Stadlers are doing? Do you have any suggestions about any changes they could make? What other information would help you analyze the situation more thoroughly?