Answer:
a. What is the 2018 operating cash flow?
$31,200 + $14,000 = $45,200
b. What is the 2018 cash flow to creditors?
-$13,100 - $3,100 = -$16,200 (it is negative since interests and principal were paid to creditors)
c. What is the 2018 cash flow to stockholders?
-$10,000 + $4,600 = -$5,400 (it is negative since more dividends were paid to stockholders than new equity raised)
d. If net fixed assets increased by $22,000 during the <em>year, what was the addition to NWC?</em>
net capital spending = depreciation + increase in fixed assets = $14,000 + $22,000 = $36,000
cash flow from assets = cash flow to creditors + cash flow to stockholders = -$16,200 - $5,400 = -$21,600
change in net working capital = operating cash flow + cash flow from assets - net capital spending = $45,200 - $21,600 - $36,000 = $12,400
Explanation:
net income = $206,000 - $123,000 - $7,900 - $14,000 - $13,100 - $16,800 = $31,200
