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Financial analysis exercises and questions Essay

Category: Finance & Accounting Pages: 2 Type: Essay Level: College
Cash balance at beginning of year
$386,000
Net increase (decrease) in cash during the year
116,000

Cash balance at the end of the year

$502000




Exercise 2-11 Retained Earnings Computations
The amount of Retained Earnings at December 31, 2006, may be calculated as follows:
Assets = Liabilities + Capital Stock + Retained Earnings
350,000 = 80,000 + 210,000 + Retained Earnings
Retained earnings ( 12/31/05) = $60,000



The amount of Retained Earnings at December 31, 2006, may be calculated as follows:
Retained earnings (12/31/05)
$60,000
Add: Net income for year
40,000
Less: Dividends for year
25,000
Retained earnings (12/31/06)
$75,000

Exercise 2-14 Cash Flow Classifications
1. Cash receipts from selling merchandise Operating activity
2. Cash payments for wages and salaries Operating activity
3. Cash proceeds from sale of stock Operating activity
4. Cash purchase of equipment Investing activity
5. Cash dividends paid Financing activity
6. Cash received from bank loan Financing activity
7. Cash payments for inventory Operating activity
8. Cash receipts from services rendered Operating activity
9. Cash payments for taxes Operating activity
10. Cash proceeds from sale of property no
longer needed as expansion site Investing activity







Works Cited
.Libby, Robert, Libby Patricia A.,Short, Daniel G. (2001). Financial accounting NewYork,: McGrawHill.
Wild, John J. (2005). Financial accounting:Information for decisions. NewYork,: