Page 662 - Accounting Principles (A Business Perspective)

16. Analysis using the statement of cash flows

b. Did current assets other than cash increase or decrease during the year ended 2010 February 29?
c. Did current liabilities increase or decrease during the year ended 2010 February 29?
d. What were the main investing activities during this three-year period?

e. What was the main source of cash from financing activities during the three-year period?
f. Did the company pay any interest expense during the year ended 2010 February 19?
g. Given the following data, calculate the cash flow per share of common stock ratio, the cash flow margin ratio,
and the cash flow liquidity ratio. How do these ratios compare with the ratios shown for other companies in the
chapter?
(in thousands)
Average number of shares of common stock outstanding 71,839
Net sales $ 1,069,715
Cash and marketable securities 253,540
Current liabilities 164,352
Problem E The following comparative balance sheets and other data are for Dayton Tent & Awning Sales, Inc.:
Dayton Tent & Awning Sales, Inc.
Comparative Balance Sheets
2011 June 30 and 2010
2011 2010
Assets
Cash $ 441,800 $ 332,600
Accounts receivable, net 750,750 432,900
Merchandise inventory 819,000 850,200
Prepaid insurance 3,900 5,850
Land 312,000 351,000
Buildings 2,184,000 1,209,000
Machinery and tools 858,000 468,000
Accumulated depreciation – machinery and (809,250) (510,900)
tools
Total assets $ $
4,560,200 3,138,650
Liabilities and stockholders' equity
Accounts payable $ 226,750 $ 275,500
Accrued liabilities payable 185,800 111,700
Bank loans (due in 2009) 56,550 66,300
Mortgage bonds payable 382,200 185,250
Common stock - $100 par 1,755,000 585,000
Paid-in capital in excess of par 58,500 -0-
Retained earnings 1,895,400 1,914,900
Total liabilities and stockholders' equity $ $
4,560,200 3,138,650
Net income for the year was USD 128,000.
Depreciation for the year was USD 356,850.
There was a gain of USD 7,800 on the sale of land. The land was sold for USD 46,800.

The additional mortgage bonds were issued at face value as partial payment for a building valued at USD
975,000. The amount of cash paid was USD 778,050.
Machinery and tools were purchased for USD 448,500 cash.
Fully depreciated machinery with a cost of USD 58,500 was scrapped and written off.
Additional common stock was issued at USD 105 per share. The total proceeds were USD 1,228,500.
Dividends declared and paid were USD 147,500.
A payment was made on the bank loan, USD 9,750.

The company paid interest of USD 9,000 and income taxes of USD 75,000.
a. Prepare a working paper for a statement of cash flows.

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