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Accounts payable Prior year= 8,141.00

Accounts payable Current year=7,891.00
Accounts receivable Prior year= 6,091.00
Accounts receivable Current year= 6,595.00
Accruals Prior year= 957.00
Accruals Current year= 1,571.00
Cash Prior year= ???
Cash Current year= ???
Common Stock Prior year= 10,216.00
Common Stock Current year= 12,177.00
COGS Prior year= 12,762.00
COGS Current year= 18,141.00
Current portion long-term debt Prior year= 4,903.00
Current portion long-term debt Current year= 4,982.00
Depreciation expense Prior year= 2,500
Depreciation expense Current year= 2,810.00
Interest expense Prior year= 733
Interest expense Current year= 417
Inventories Prior year= 4,158.00
Inventories Current year= 4,811.00
Long-term debt Prior year= 13,134.00
Long-term debt Current year= 14,047.00
Net fixed assets Prior year= 51,651.00
Net fixed assets Current year= 54,049.00
Notes payable Prior year= 4,337.00
Notes payable Current year= 9,819.00
Operating expenses (excl. depr.) Prior year= 13,977
Operating expenses (excl. depr.) Current year=18,172
Retained earnings Prior year= 28,067.00
Retained earnings Current year= 30,007.00
Sales Prior year= 35,119
Sales Current year= 47,498.00
Taxes Prior year= 2,084
Taxes Current year= 2,775
What is the firm's net income in the current year?

11 answers

To calculate the net income for the current year, we can use the formula:

\[ \text{Net Income} = \text{Sales} - \text{COGS} - \text{Operating Expenses} - \text{Interest Expense} - \text{Taxes} \]

Let's plug in the values provided for the current year:

  1. Sales Current Year = 47,498.00
  2. COGS Current Year = 18,141.00
  3. Operating Expenses (excl. depr.) Current Year = 18,172.00
  4. Depreciation Expense Current Year = 2,810.00 (we'll need to include this in total operating expenses)
  5. Interest Expense Current Year = 417.00
  6. Taxes Current Year = 2,775.00

Calculate Total Operating Expenses

\[ \text{Total Operating Expenses Current Year} = \text{Operating Expenses (excl. depr.)} + \text{Depreciation Expense} \]

\[ \text{Total Operating Expenses Current Year} = 18,172.00 + 2,810.00 = 20,982.00 \]

Now Calculate Net Income

\[ \text{Net Income} = \text{Sales} - \text{COGS} - \text{Total Operating Expenses} - \text{Interest Expense} - \text{Taxes} \]

Substituting in the values:

\[ \text{Net Income} = 47,498.00 - 18,141.00 - 20,982.00 - 417.00 - 2,775.00 \]

Calculating step-by-step:

\[ \text{Net Income} = 47,498.00 - 18,141.00 = 29,357.00 \] \[ \text{Net Income} = 29,357.00 - 20,982.00 = 8,375.00 \] \[ \text{Net Income} = 8,375.00 - 417.00 = 7,958.00 \] \[ \text{Net Income} = 7,958.00 - 2,775.00 = 5,183.00 \]

Final Result

The firm's net income for the current year is $5,183.00.

What is the firm's dividend payment in the current year?

To calculate the dividend payment for the current year, we can use the formula for retained earnings:

\[ \text{Ending Retained Earnings} = \text{Beginning Retained Earnings} + \text{Net Income} - \text{Dividends Paid} \]

Rearranging the formula to find dividends paid gives us:

\[ \text{Dividends Paid} = \text{Beginning Retained Earnings} + \text{Net Income} - \text{Ending Retained Earnings} \]

From the data provided:

  • Beginning Retained Earnings (Prior Year) = 28,067.00
  • Ending Retained Earnings (Current Year) = 30,007.00
  • Net Income for the Current Year (calculated earlier) = 5,183.00

Substituting these values into the rearranged formula:

\[ \text{Dividends Paid} = 28,067.00 + 5,183.00 - 30,007.00 \]

Calculating:

\[ \text{Dividends Paid} = 28,067.00 + 5,183.00 = 33,250.00 \] \[ \text{Dividends Paid} = 33,250.00 - 30,007.00 = 3,243.00 \]

Final Result

The firm's dividend payment in the current year is $3,243.00.

What is the firm's cash flow from operations?

To calculate the cash flow from operations (CFO), we typically start with net income and make adjustments for non-cash expenses and changes in working capital accounts.

Here's a simplified version of the calculation using the data you provided:

  1. Net Income: We previously calculated net income for the current year as $5,183.00.

  2. Adjustments for non-cash expenses:

    • Add back Depreciation Expense (since it is a non-cash expense).

    \[ \text{Depreciation Expense} = 2,810.00 \]

  3. Changes in working capital: We need to determine the changes in accounts receivable, accounts payable, inventories, and other relevant current assets and liabilities.

    • Change in Accounts Receivable (A/R): \[ \text{Change in A/R} = \text{A/R Current Year} - \text{A/R Prior Year} = 6,595.00 - 6,091.00 = 504.00 \quad (\text{outflow}) \]

    • Change in Accounts Payable (A/P): \[ \text{Change in A/P} = \text{A/P Current Year} - \text{A/P Prior Year} = 7,891.00 - 8,141.00 = -250.00 \quad (\text{outflow}) \]

    • Change in Inventories: \[ \text{Change in Inventories} = \text{Inventories Current Year} - \text{Inventories Prior Year} = 4,811.00 - 4,158.00 = 653.00 \quad (\text{outflow}) \]

  4. Summing up changes in working capital: \[ \text{Total Change in Working Capital} = \text{Change in A/R} + \text{Change in A/P} + \text{Change in Inventories} \] \[ \text{Total Change in Working Capital} = -504.00 - 250.00 - 653.00 = -1,407.00 \quad (\text{net outflow}) \]

Cash Flow from Operations Calculation

Now we can calculate Cash Flow from Operations using the formula:

\[ \text{CFO} = \text{Net Income} + \text{Depreciation Expense} + \text{Total Change in Working Capital} \]

Substituting in the values we have:

\[ \text{CFO} = 5,183.00 + 2,810.00 - 1,407.00 \]

Calculating:

\[ \text{CFO} = 5,183.00 + 2,810.00 = 7,993.00 \] \[ \text{CFO} = 7,993.00 - 1,407.00 = 6,586.00 \]

Final Result

The firm's cash flow from operations for the current year is $6,586.00.

What is the firm's cash flow from financing?

To determine the firm's cash flow from financing (CFF), we typically look at the changes in long-term debt, short-term debt (like notes payable), and changes in equity (such as common stock), along with any dividends paid. The formula can be simplified as follows:

\[ \text{CFF} = (\text{New Debt Issued} - \text{Debt Repaid}) + (\text{New Equity Issued} - \text{Dividends Paid}) \]

Let's break it down step by step using the information you provided.

Changes in Debt and Equity

  1. Change in Long-Term Debt: \[ \text{Long-Term Debt CFF} = \text{Long-Term Debt Current Year} - \text{Long-Term Debt Prior Year} = 14,047.00 - 13,134.00 = 913.00 \quad (\text{inflow}) \]

  2. Change in Current Portion of Long-Term Debt (if applicable, though not typically included in CFF): \[ \text{Current Portion Long-Term Debt} = 4,982.00 - 4,903.00 = 79.00 \quad (\text{inflow, but usually we focus on long-term debt}) \]

  3. Change in Notes Payable: \[ \text{Notes Payable CFF} = \text{Notes Payable Current Year} - \text{Notes Payable Prior Year} = 9,819.00 - 4,337.00 = 5,482.00 \quad (\text{inflow}) \]

  4. Change in Common Stock: \[ \text{Change in Common Stock} = \text{Common Stock Current Year} - \text{Common Stock Prior Year} = 12,177.00 - 10,216.00 = 1,961.00 \quad (\text{inflow}) \]

  5. Dividends Paid (calculated previously as 3,243.00): \[ \text{Dividends Paid} = 3,243.00 \quad (\text{outflow}) \]

Cash Flow from Financing Calculation

Now, we sum all of these components to get Cash Flow from Financing (CFF):

\[ \text{CFF} = (\text{Change in Long-Term Debt}) + (\text{Change in Notes Payable}) + (\text{Change in Common Stock}) - (\text{Dividends Paid}) \]

Substituting in the values:

\[ \text{CFF} = 913.00 + 5,482.00 + 1,961.00 - 3,243.00 \]

Calculating:

\[ \text{CFF} = 913.00 + 5,482.00 = 6,395.00 \] \[ \text{CFF} = 6,395.00 + 1,961.00 = 8,356.00 \] \[ \text{CFF} = 8,356.00 - 3,243.00 = 5,113.00 \]

Final Result

The firm's cash flow from financing for the current year is $5,113.00.

What is the firm's cash flow from investing?

To determine the firm's cash flow from investing (CFI), we typically look at transactions related to the acquisition or sale of long-term assets, such as fixed assets and investments. This includes:

  1. Cash paid for capital expenditures (CapEx), which is the purchase of net fixed assets.
  2. Cash received from the sale of assets.

From the data you've provided, we can identify changes in net fixed assets, but we would need additional information about asset purchases or sales to compute cash flow from investing accurately. However, we can use the change in net fixed assets as a proxy for cash flow from investing assuming that there were no asset sales.

Change in Net Fixed Assets

  1. Net Fixed Assets:
    • Prior Year: 51,651.00
    • Current Year: 54,049.00

Calculate the change in net fixed assets:

\[ \text{Change in Net Fixed Assets} = \text{Net Fixed Assets Current Year} - \text{Net Fixed Assets Prior Year} \] \[ \text{Change in Net Fixed Assets} = 54,049.00 - 51,651.00 = 2,398.00 \]

Interpretation

In this case, since the net fixed assets increased by 2,398.00, it indicates an outflow of cash due to capital expenditures, as the firm likely purchased new fixed assets.

Cash Flow from Investing Calculation

Assuming there's no asset sale, the cash flow from investing will be negative, reflecting the cash spend on capital purchases:

\[ \text{CFI} = -\text{Change in Net Fixed Assets} = -2,398.00 \]

Final Result

The firm's cash flow from investing for the current year is \(-2,398.00\), indicating a cash outflow due to capital expenditures. If you have any information on asset sales, we could adjust this figure accordingly.

I got:
cash flow from investing= -5,208
cash flow from financing= 5,192
cash flow from operations= 7,200
What is the firm's total change in cash from the prior year to the current year?

To calculate the total change in cash from the prior year to the current year, you can sum the cash flows from operations, investing, and financing. The formula is:

\[ \text{Total Change in Cash} = \text{Cash Flow from Operations} + \text{Cash Flow from Investing} + \text{Cash Flow from Financing} \]

Substituting the values you provided:

  • Cash Flow from Operations (CFO): \( 7,200 \)
  • Cash Flow from Investing (CFI): \( -5,208 \) (cash outflow)
  • Cash Flow from Financing (CFF): \( 5,192 \)

Now we can perform the calculation:

\[ \text{Total Change in Cash} = 7,200 + (-5,208) + 5,192 \]

Calculating step by step:

  1. Combine CFI and CFF: \[ -5,208 + 5,192 = -16 \]

  2. Then add CFO: \[ \text{Total Change in Cash} = 7,200 + (-16) = 7,184 \]

Final Result

The firm's total change in cash from the prior year to the current year is $7,184.00.