Delta Retailers Inc.

Scenario: Cash Flow Statement Analysis

Data:

• Operating Activities:
  • Net Income: $80,000
  • Depreciation Expense: $20,000
  • Increase in Accounts Receivable: $10,000

• Investing Activities:
  • Purchase of Equipment: $30,000
  • Sale of Investments: $5,000

• Financing Activities:
  • Issuance of Long-term Debt: $50,000
  • Repayment of Short-term Borrowings: $10,000

Requirements:

1. Prepare the statement of cash flows for the year ended December 31, 2023.
2. Classify cash flows into operating, investing, and financing activities.
3. Analyze Delta Retailers Inc.'s cash flow position and liquidity.
4. Discuss the impact of financing activities on the company's capital structure.