Can I get the answers for this chapter case Qs??

CHAPTER 2 Financial Statements, Taxes, and Cash Flow 49 CHAPTER CASE Cash Flows and Financial Statements at Sunset Boards, Inc. unset Boards is a small company that manufactures and sells surfboards in Malibu. Tad Marks, the founder of the company, is in charge of the design and 2018 2019 sale of the surfboards, but his background is in surfing, Cost of goods sold $224,359 $283,281 not business. As a result, the company's financial Cash 32,372 34,394 records are not well maintained. Depreciation 63,334 71,584 Interest expense 13,783 15,780 The initial investment in Sunset Boards was pro- Selling and administrative 44,121 57,586 vided by Tad and his friends and family. Because the ini- expenses tial investment was relatively small, and the company Accounts payable 57,220 63,479 Net fixed assets 279,419 348,508 has made surfboards only for its own store, the investors Sales 440, 122 536,483 haven't required detailed financial statements from Tad. Accounts receivable 22,939 29,755 But thanks to word of mouth among professional surf- Notes payable 26,079 28,474 158,368 ers, sales have picked up recently, and Tad is consider- Long-term debt 141,040 Inventory 48,272 66,244 ing a major expansion. His plans include opening New equity 0 27,157 another surfboard store in Hawaii, as well as supplying his "sticks" (surfer lingo for boards) to other sellers. Sunset Boards currently pays out 50 percent of net Tad's expansion plans require a significant invest- income as dividends to Tad and the other original inves- ment, which he plans to finance with a combination of tors and has a 21 percent tax rate. You are Jameson's additional funds from outsiders plus some money bor- assistant, and he has asked you to prepare the rowed from banks. Naturally, the new investors and following: creditors require more organized and detailed financial 1. An income statement for 2018 and 2019. statements than Tad has previously prepared. At the urging of his investors, Tad has hired financial analyst 2. A balance sheet for 2018 and 2019. Jameson Reid to evaluate the performance of the com- 3. Operating cash flow for each year. Cash flow from assets for 2019. pany over the past year. 4. After rooting through old bank statements, sales re- 5. Cash flow to creditors for 2019. ceipts, tax returns, and other records, Jameson has as- 6 . Cash flow to stockholders for 2019. sembled the following information: QUESTIONS 1. How would you describe Sunset Boards's cash 2. In light of your discussion in the previous question, flows for 2019? Write a brief discussion. what do you think about Tad's expansion plans