ACCT 1220 Chapter Notes - Chapter 13: Accrual, Cash Flow, Financial Statement
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The Blackbeard Company Ltd provided the following information in regard to its operations for the year ended 30 June 2014:
Cash Book Summary | |||
Opening balance | $20,000 | Accounts Payable | $40,000 |
Accounts receivable | 100,000 | Bills Payable (suppliers) | 20,000 |
Bills Receivable (suppliers) | 20,000 | Interest paid | 60,000 |
Debenture Issue | 400,000 | Operating expenses | 180,000 |
Dividends received | 20,000 | Salaries & wages | 200,000 |
Interest received | 40,000 | Current tax payable | 80,000 |
Motor vehicles | 60,000 | Plant & machinery | 100,000 |
Share capital | 200,000 | Dividend paid | 120,000 |
Balance c/d | 60,000 | ||
860,000 | 860,000 | ||
Balance b/d | 60,000 |
Required:
(a) Net cash used in operating activities; (b) Net cash used in investing activities; (c) Net cash from financing activities;
(d) Net increase/(decrease) in cash and cash equivalents.
Please use the following format
Statement of Cash Flows for Blackbeard Company | ||
For the Financial Year Ended 30 June 2014 | ||
( i ) Cash flows from Operating Activities | Inflows/ | Inflows/ |
(Outflows) | (Outflows) | |
Net cash used in operating activities | ||
( ii ) Cash flows from Investing Activities | ||
Net cash used in Investing Activities | ||
( iii ) Cash flows from Financing Activities | ||
Selected information (CAD millions) are presented for two firms ROP and DUL, operating in the same industries:
DUL | ROH | |
Net income | $ 4,529 | $ 161 |
Net cash provided by operating activities | 6,539 | 212 |
Net cash provided (used) by investing activities | (1,420) | 35 |
Net cash provided (used) by financing activities | 735 | (176) |
Net increase in cash and cash equivalents | $ 5,854 | $ 71 |
Cash and cash equivalents, beginning of year | $ 2,078 | $ 267 |
Cash and cash equivalents, end of year | $ 7,932 | $ 338 |
Required:
i) Compare and discuss the performance / activity the two companies based on the above Cash Flow and Net Income information.
ii) Which company appears to be in a stronger Cash position? Why?