Blue Diamond Industries had the following operating results for 2017; sales = $44,600; cost of goods sold

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Blue Diamond Industries had the following operating results for 2017; sales = $44,600; cost of goods sold = $27,500; depreciation expense = $4,630; interest expense = $1,050; dividends paid = $2,275. At the beginning of the year, net fixed assets were $27,510,current assets were $6,840, and current liabilities were $4,580. At the end of the year, net fixed assets were $35,610, current assets were $7,720, and current liabilities were $4,830. The tax rate was 40 percent.
a. What was net income for 2017?
b. What was the operating cash flow for 2017?
c. What was the cash flow from assets for 2017? Is this possible? Explain.
d. If no new debt was issued during the year, what was the cash flow to creditors? What was the cash flow to stockholders? Explain and interpret the positive and negative signs of your answers in (a) through (d).

Cash Flow From Assets
Cash flow from assets is the aggregate total of all cash flows related to the assets of a business. This information is used to determine the net amount of cash being spun off by or used in the operations of a business. The concept is comprised of...
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Corporate Finance Core Principles and Applications

ISBN: 978-1259289903

5th edition

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford Jordan

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