You work as a freelance accounting professional and have been recently engaged by the auditors of Life-Positive Inc. for an assignment. In examining the company's records, you have extracted the following information:

Life-Positive's Account Balances

2021 ($)

2022 ($)

ACCOUNTS PAYABLE

24,600.00 21,250.00

ACCOUNTS RECEIVABLE

15,700.00 12,340.00

CASH

23,450.00 28,600.00

COST OF GOODS SOLD

19,700.00 23,000.00

DEPRECIATION

3,090.00 4,590.00

DIVIDENDS

5,800.00 10,800.00

INTEREST

2,340.00 2,890.00

INVENTORY

7,050.00 8,640.00

LONG-TERM DEBT

28,000.00 30,000.do

NET FIXED ASSETS

41,500.00 48,000.00

OTHER EXPENSES

2,400.00 2,800.00

SALES

58,000.00 62,500.00

SHORT TERM NOTES PAYABLE

2,890.00 2,340.00

SHARES OUTSTANDING

85,000.00 90,000.00

The tax rate is 32%

Required:

1. Prepare balance sheet for 2021 and 2022 for the company, clearly showing information about each line item. 2. Prepare income statement for 2021 and 2022 for the company.

3. For the year ending 2022, determine the Net New Equity, Change in Net Working Capital, Net Capital Spending and

Operating Cash flow.

4. Calculate the cash flow from assets, cash flow to creditors, and cash flow to stockholders for 2022.

5. Calculate the Dividends per Share and Earnings per Share for each year for Brown Company.

6. Briefly comment on the company's cash flows for 2022 in light of an expansion plan which will be financed by both debt and equity.