Clasify the following items as an operating, investing, or financing activity. Assume all items involve cash

Day 1:

Clasify the following items as an operating, investing, or financing activity. Assume all items involve cash.

1. 
   purchase of equipment
   
2. 
   Sale of building
   
3. 
   Retired bonds
   
4. 
   Payment of dividends
   
5. 
   Issue of share capital
   

Eng Corporation had the following transactions during 2003:

1. 
   Purchased a machine for $30,000, giving a long-term note in exchange.
   
2. 
   Issued common shares for cash, $50,000.
   
3. 
   Collected $16,000 of accounts receivable.
   
4. 
   Declared and paid a cash dividend of $25,000.
   
5. 
   Sold a long-term investment with a cost of $15,000 for $10,000 cash.
   
6. 
   Retired bonds having a carrying value of $200,000 for $175,000.
   

Analyze the transactions above an indicate whether each transaction resulted in a cash inflow or cash outflow from a) operating activities, b) investing activities, c) financing activities, or d) non-cash investing and financing activities.

Pesci Company reported net income of $195,000 for the year ended July 31, 2003. Pesci also reported an amortization expense of $45,000 and a loss of $5,000 on the sale of equipment. The comparative balance sheet shows an increase in accounts receivable of $15,000 for the year, an $8,000 increase in accounts payable, and a decrease in prepaid expenses of $4,000.

Prepare the operating activities section of the cash flow statement for 2003. Use the indirect method.

Dressmart.com Inc., reported net income of $2.5 million in 2003. Amortization expense for the year was $280,000, accounts receivable decreased by $350,000, and accounts payable decreased by $310,000. Calculate net cash provided by operating activities using the indirect method.

The comparative balance sheet for the Harden Company shows the following changes in noncash current asset accounts:

• 
  Accounts Receivable decrease of $75,000
  
• 
  Prepaid Expenses increase of $12,000
  
• 
  Inventories increase of $30,000.
  

Calculate net cash provided by operating activities using the indirect method. Assume that net income is $220,000 for the year ended December 31, 2003.

The current sections of Invest.com Inc.’s balance sheets at December 31, 2002 and 2003, are presented below.

	2003	2002
Current assets
Cash	$105,000	$99,000
Accounts receivable	110,000	89,000
Inventory	171,000	186,000
Prepaid expenses	27,000	32,000
Total current assets	$413,000	$406,000
Current liabilities
Accrued expenses payable	$15,000	$5,000
Accounts payable	85,000	92,000
Total current liabilities	$100,000	$97,000

Invest.com’s net income for 2003 was $163,000. Amortization expense was $30,000.

Prepare the operating activities section on Invest.com Inc.’s cash flow statement for the year ended December 31, 2003, using the indirect method.

Presented below is the comparative balance sheet for Cousin Tommy’s Toy Company as of December 31:

Asset	2003	2002
Cash	$39,000	$45,000
Accounts receivable	49,500	52,000
Inventory	151,450	142,000
Prepaid expenses	16,780	21,000
Land	100,000	130,000
Equipment	228,000	155,000
Accumulated amortization – equipment	(45,000)	(35,000)
Building	200,000	200,000
Accumulated amortization – building	(60,000)	(40,000)
	$679,730	$670,000
Liabilities and Shareholders’ Equity
Accounts payable	$38,730	$40,000
Bonds Payable	250,000	300,000
Common Shares	191,000	180,000
Retained Earnings	$679,730	$670,000

Additional information:

1. 
   Operating expenses include amortization expense of $42,000.
   
2. 
   Land was sold for cash at cost.
   
3. 
   Cash dividends of $27,000 were paid.
   
4. 
   Equipment was purchased for $95,000 cash. IN addition, equipment costing $22,000 with a net book value of $10,000 was sold for $8,100 cash.
   
5. 
   Bonds were redeemed at face value by issuing common shares.
   

Prepare a cash flow statement for te year ended December 31, 2003, using the indirect method.

Westcoast Corporation has accounts receivable of $14,000 at January 1, 2003, and of $24,000 at December 31, 2003. Sales revenues were $470,000 for the year. What is the amount of cash receipts from a customers in 2003?

Home Grocery Corporation reported income tax expense of $90,000 in its 2003 income statement, and income tax payable of $14,000 at December 31, 2002, and of $9,000 at December 31, 2003. What was the amount of cash payments made for income tax during 2003?

Linux Corporation reports operating expense of $100,000, excluding amortization expense of $15,000, for 2003. During the year, prepaid expenses decreased by $6,600 and accrued expenses payable increased by $2,400. Calculate the cash payments for operating expenses in 2003.

The year 2003 accounting records of Frontier Airlines reveal the following transactions and events:

Prepare the operating ctvities section of the cash flow statement, using the direct method. (Note: Not all of the above items will be used.)

Condensed financial data of e-Perform.com Ltd. appear below:

Assets	2003	2003
Cash	$92,700	$47,250
Accounts receivable	90,800	57,000
Inventories	121,900	102,650
Investments	84,500	87,000
Capital assets	250,000	205,000
Accumulated amortization	(49,500)	(40,000)
	$590,400	$458,900
Liabilities and Shareholders’ Equity
Accounts payable	$57,700	$48,280
Accrued expenses payable	12,100	18,830
Bonds payable	100,000	70,000
Common Shares	250,000	200,000
Retained earnings	170,600	121,790
	$590,400	$458,900

Revenues
Sales	$297,500
Gain on sale of capital assets	8,750	$306,250
Expenses
Cost of goods sold	$99,460
Operating expenses	14,670
Amortization expense	49,700
Income tax expense	7,270
Interest expense	2,940	174,040
Net Income		$132,210

Additional Information:

1. 
   New capital assets costing $92,000 were purchased for cash during the year.
   
2. 
   Investments were sold at cost.
   
3. 
   Capital assets costing $47,000 were sold for $15,550.
   
4. 
   A cash dividend of $83,400 was declared and paid during the year.
   
5. 
   Accounts payable relate only to merchandise creditors.
   

Prepare a cash flow statement using the direct method.

For the year ended March 31, 2000, Alliance Atlantis Communications Inc. reported (in millions) cash provided by operating activities of $558.2; cash used by investing activities of $666.2; and cash provided by financing activities of $52.5. In addition, average current liabilities were $581.6; average total liabilities were $884.6; net sales and net income available to common shareholders were $771.6 and $37.0, respectively. The number of shares was 28.2. Calculate these values: a) cash current debt coverage, b) cash returns on sales, c) cash flow per share, and d) cash total debt coverage.

The comparative balance sheet for Véfour Company is presented below:

Additional information:

1. 
   Net income for 2003 was $125,000.
   
2. 
   Cash dividends of $60,000 were declared and paid.
   
3. 
   Bonds pyabale with a carrying value of $50,000 were redeemed for $50,000 cash.
   
4. 
   Common shares were issued for $50,000 cash.
   
5. 
   Land was sold at a gain of $5,000
   
6. 
   Net sales for the year were $978,000.
   

1. 
   Prepare a cash flow statement for 2003 using the indirect method.
   
2. 
   Calculate the following cash-based ratios:
   

1. 
   Cash current debt coverage
   
2. 
   Cash return on sales
   
3. 
   Cash total debt coverage
   

Presented here is selected information (in thousands) for Reitmans (Canada) Limited and La Senza for the year ended January 29, 2000.