Selected data (in thousands) derived from the income statement and balance sheet of National Beverage Corp. for a recent year are as follows:

Income statement data:
Net income	$49,340
Gain on disposal of property	1,210
Depreciation expense	11,630
Other items involving noncash expenses	1,345
Balance sheet data:
Increase in accounts receivable	1,720
Decrease in inventory	965
Increase in prepaid expenses	600
Decrease in accounts payable	755
Decrease in accrued and other current liabilities	1,020

Question Content Area

a. Prepare the Cash flows from operating activities section of the statement of cash flows, using the indirect method for National Beverage Corp. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Enter the amounts in thousands of dollars, as shown above.

Cash flows from (used for) operating activities:
Gain on disposal of propertyIncrease in accounts receivableIncrease in prepaid expensesNet incomeNet loss	$- Select -	blank
Adjustments to reconcile net income to net cash flow from operating activities:
Decrease in accounts payable and other current liabilitiesDecrease in accounts receivableDepreciationIncrease in accounts receivableNet income	- Select -
Decrease in accounts receivableDecrease in inventoryDecrease in prepaid expensesGain on disposal of propertyNet income	- Select -
Decrease in accounts payable and other current liabilitiesDecrease in accounts receivableIncrease in accounts receivableNet incomeOther items involving noncash expenses	- Select -
Changes in current operating assets and liabilities:
DepreciationIncrease in accounts receivableLoss on inventory write-down and fixed assetsNet income	- Select -
DepreciationDecrease in inventoryLoss on inventory write down and fixed assetsNet incomeStock-based compensation expense (noncash)	- Select -
Decrease in prepaid expensesDepreciationIncrease in prepaid expensesLoss on inventory write down and fixed assetsStock-based compensation expense (noncash)	- Select -
Decrease in accounts payableIncrease in accounts payableLoss on inventory write down and fixed assetsNet incomeStock-based compensation expense (noncash)	- Select -	blank
Decrease in accrued and other current liabilitiesIncrease in accrued and other current liabilitiesLoss on inventory write down and fixed assetsNet incomeStock-based compensation expense (noncash)	- Select -
Net cash flow from operating activities		$fill in the blank 65116c0a5f97fd1_19

Question Content Area

b. The company has

negativepositive

earnings and

negativepositive

net cash flow from operating activities. The increase in accounts receivable indicates a(n)

decreaseincrease

in sales. In addition, the company is using its cash to decrease its accounts payable balance, which indicates that the company is

falling behind in its payments to vendorsgenerating enough cash from operations to pay for its inventory in cash

. Overall, National Beverage is doing

poorlywell

financially.