Using the Income Statement and Balance Sheet provided in Unit $2,$ generate a

Cash Flow Statement. You may have to make some assumptions in the process;

list them in a comment column of your Cash Flow Statement.

$$ Summarize your findings and observations.

$$ What is your analysis of their current profit vs$.$ cash situation?

$$ Are they in danger of running out of cash? What are your findings? Explain.

$$ What does their, as Warren Buffet, refe rs$,$owning earnings$($free cash flow$)$ look like? Complete Cash Flow Statement $($$ Thousands$)$

Cash Flow from Operating Activities Line$($s$)$ Used $($e$.$g$.,2015$ Accounts Payable $-2016$ Accounts Payable$)$

Net income

Change in Accounts Payable

Change in Accounts Receivable

Change in Inventory

Other Adjustments:

Accrued Expenses

Depreciation Expense

Income Taxes

Net Cash provided by Operating Activities

Cash Flow from Investing Activities Line$($s$)$ Used

Sale of Plant, Property and Equipment

Purchase of Assets $($Intangibles$)$

Sales of other assets

Income from short term investments $($assumption from IS$)$

Net Cash used in Investing Activities

Cash Flows from Financing Activities Line$($s$)$ Used

Additions to long$-$term debts

Cash dividends

Repurchase of Treasury Stock

Net cash used in Financing Activities

Increase$/$Decrease in cash and cash equivalents

Cash and Cash Equivalents at the beginning of the period

ANNUAL BALANCE SHEET

$($$ Thousands$)$

BB

$31-$Dec$-1531-$Dec$-16$

ASSETS

Cash & Short$-$Term Investments $$17\mathrm{.}11$ $$25\mathrm{.}05$

Net Receivables $$1\mathrm{.}62$ $$1\mathrm{.}84$

Inventories $$42\mathrm{.}72$ $$39\mathrm{.}68$

Prepaid Expenses $$0\mathrm{.}00$ $$0\mathrm{.}00$

Other Current Assets $$3\mathrm{.}38$ $$2\mathrm{.}93$

Total Current Assets $$64\mathrm{.}84$ $$69\mathrm{.}49$

Gross Plant, Property & Equipment $$63\mathrm{.}75$ $$58\mathrm{.}28$

Accumulated Depreciation $$36\mathrm{.}16$ $$32\mathrm{.}61$

Net Plant, Property & Equipment $$27\mathrm{.}58$ $$25\mathrm{.}67$

Intangibles $$5\mathrm{.}88$ $$6\mathrm{.}01$

Other Assets $$6\mathrm{.}16$ $$5\mathrm{.}81$

TOTAL ASSETS $$104\mathrm{.}47$ $$106\mathrm{.}98$

LIABILITIES

Long Term Debt Due In One Year $$0\mathrm{.}00$ $$0\mathrm{.}00$

Accounts Payable $$10\mathrm{.}59$ $$11\mathrm{.}91$

Taxes Payable $$1\mathrm{.}87$ $$2\mathrm{.}01$

Accrued Expenses $$7\mathrm{.}19$ $$6\mathrm{.}91$

Other Current Liabilities $$1\mathrm{.}88$ $$1\mathrm{.}85$

Total Current Liabilities $$21\mathrm{.}54$ $$22\mathrm{.}67$

Long Term Debt $$6\mathrm{.}95$ $$19\mathrm{.}79$

Deferred Taxes $$1\mathrm{.}16$ $$2\mathrm{.}32$

Other Liabilities $$3\mathrm{.}04$ $$2\mathrm{.}43$

TOTAL LIABILITIES $$32\mathrm{.}68$ $$47\mathrm{.}21$

EQUITY

Common Stock $$0\mathrm{.}07$ $$0\mathrm{.}06$

Capital Surplus $$27\mathrm{.}25$ $$24\mathrm{.}31$

Retained Earnings $$73\mathrm{.}89$ $$61\mathrm{.}10$

Less: Treasury Stock $$29\mathrm{.}42$ $$25\mathrm{.}71$

TOTAL EQUITY $$71\mathrm{.}79$ $$59\mathrm{.}77$

TOTAL LIABILITIES & EQUITY $$104\mathrm{.}47$ $$106\mathrm{.}98$

Common Shares Outstanding $$5\mathrm{.}14$ $$5\mathrm{.}05$Cash and Cash Equivalents at the end of the period Annual Income Statement

$($$ Thousands, except per share $)$

$20152016$

Sales $$179\mathrm{.}24$ $$164\mathrm{.}28$

Cost of Goods Sold $$95\mathrm{.}71$ $$91\mathrm{.}99$

Gross Profit $$83\mathrm{.}53$ $$72\mathrm{.}29$

Selling, General, & Administrative Exp. $$56\mathrm{.}36$ $$50\mathrm{.}65$

Operating Income Before Deprec. $$27\mathrm{.}17$ $$21\mathrm{.}64$

Depreciation,Depletion,&Amortization $$5\mathrm{.}85$ $$5\mathrm{.}89$

Operating Profit $$21\mathrm{.}33$ $$15\mathrm{.}74$

Interest Expense $$0\mathrm{.}88$ $$0\mathrm{.}56$

Non$-$Operating Income$/$Expense $$0\mathrm{.}93$ $$0\mathrm{.}31$

Special Items $$0\mathrm{.}00$ $$0\mathrm{.}00$

Pretax Income $$21\mathrm{.}38$ $$15\mathrm{.}49$

Total Income Taxes $$7\mathrm{.}23$ $$5\mathrm{.}60$

Income Before Extraordinary

Items & Discontinued Operations $$14\mathrm{.}15$ $$9\mathrm{.}90$

Savings Due to Common Stock Equiv. $$0\mathrm{.}00$ $$0\mathrm{.}00$

Adjusted Net Income $$14\mathrm{.}15$ $$9\mathrm{.}90$

EPS Basic from Operations $$0\mathrm{.}26$ $$0\mathrm{.}19$

EPS Diluted from Operations $$0\mathrm{.}25$ $$0\mathrm{.}19$

Dividends Per Share $$0\mathrm{.}02$ $$0\mathrm{.}00$

Com Shares for Basic EPS $$5\mathrm{.}06$ $$5\mathrm{.}12$

Com Shares for Diluted EPS $$5\mathrm{.}21$ $$5\mathrm{.}27$