1. Sold investments costing $57,000 for $62,000.

4. Sold equipment for $14,000 cash that originally cost $46,000 and had $28,000 accumulated depreciation. This means the bo
6. a. Acquired a patent with a fair value of $30,000 by issuing 300 shares of preferred stock at par value.
6. b. Also issued an additional 200 shares for a cash price of $20,000.
7. Declared and paid a $60,000 cash dividend.
8. Issued 4,000 shares of common stock for cash at $9 per share. (4000*9)=36000
9. Recorded depreciation of $17,000 on buildings and $24,000 on equipment.

Cash Paid for interest

Interest expense 15000
Increase in int pay 2000
Cash interest paid 13000

Cash Paid for Tax

Tax expense 44000
Dec tax pay 3000
Cash Tax Paid 47000
2020 2019
Cash and cash equivalents 62000 25000
Accounts receivable 41000 30000
Inventory 97000 77000
Prepaid expenses 11000 21000

CA 211000 153000

Accounts payable 23000 16000

Accrued expenses 21000 15000

CL 44000 31000

CA-CL 167000 122000

NINWC 45000

EBIT
Sales 850000
COGS 490000
O/P exp 140000
Dep 41000
Patent Amor 8000
Operating profit 171000

OCF EBIT Dep Amor tax

OCF 171000 41000 8000 47000
173000

ICF Calculation 2020 2019

Land 195000 100000
Buildings 460000 350000
Accumulated depreciation, Build -92000 -75000
Equipment 179000 225000
Accumulated depreciation, Equi -42000 -46000

PPE 700000 554000

Delta PPE 146000
Dep 41000
Intangible Asset 22000
Amortization 8000
Book Value of PPE Sold 18000
Non-Cash Purchase 30000
Cash Proceed from sale of PPE 14000

ICF= Δ Net PPE + Depreciation + Δ Intangible Assets + Amortization + Book value of PPE sold – Non

191000

FCF Calculation
Debt holder Cash interest paid+ Cash used in debt retirement – Proceeds from long-term debt sales
13000 0 33000
-20000

Stockholder Dividend paid – (Stock sold – Stock repurchased)

60000 142000 40000

-42000

OCF-ICF-NINWC -63000
FCF-D + FCF-S -62000
preciation. This means the book value of the equipment sold was $46,000 – $28,000 = $18,000.
Book value of PPE sold – Non-cash purchase of PPE – Cash proceeds from sale of PPE

m long-term debt sales Preferred stock ($100 par v 125,000 75,000 50,000
Common stock ($5 par valu 384,000 364,000 20,000
Capital surplus - Common 140,000 124,000 16,000
9*4000 36000
200*100 20000
Treasury stock -40,000 –
Sales 850000
Cost of goods sold 490000
Wages and other operating expenses 140000
Depreciation expense 41000
Patent amortization expense 8000
Interest expense 15000
Income tax expense 44000
Loss on sale of equipment 4000
Gain on sale of investments -5000
Dividend income 25000

Sales 850000
COGS 490000
O/P exp 140000
Dep 41000
Patent Amor 8000
Operating profit Or EBIT 171000
Dividend income 25000
Interest expense 15000
Loss on sale of equipment 4000
Gain on sale of investments 5000
Taxable income 182000
Income tax expense 44000
Net income 138000
Depreciation expense 41000
Patent Amor 8000
Loss on sale of equipment 4000
Non-Cash Earnings (Dividend income) 25000
Gain on sale of investments 5000

net investment in net operating working capital

Accounts receivable (increase) 11000
Inventory (Increase) 20000
Prepaid expenses (decrease) 10000

Account Payable (increase) 7000

Accrued expenses (increase) 6000
deffred tax (dec) 3000

OCF 150000