Fundamentals of Financial Management (Concise 6th Edition)

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Chapter 3 Financial Statements, Cash Flow, and Taxes 83

Tabl e I C 3 - 3 Statement of Stockholders’ Equity, 2008


COMMON STOCK
Retained
Earnings

Total
Stockholders’
Shares Amount Equity
Balances, 12/31/07 100,000 $460,000 $ 203,768 $663,768
2008 Net Income (160,176)
Cash Dividends (11,000)
Addition (Subtraction)
to Retained Earnings (171,176)
Balances, 12/31/08 100,000 $460,000 $ 32,592 $492,592

Operating Activities
Net income ($160,176)
Depreciation and amortization 116,960
Increase in accounts payable 378,560
Increase in accruals 353,600
Increase in accounts receivable (280,960)
Increase in inventories (572,160)
Net cash provided by operating activities ($164,176)

Long-Term Investing Activities
Additions to property, plant, and equipment ($711,950)
Net cash used in investing activities ($711,950)

Financing Activities
Increase in notes payable $436,808
Increase in long-term debt 400,000
Payment of cash dividends (11,000)
Net cash provided by financing activities $825,808

Summary
Net decrease in cash ($ 50,318)
Cash at beginning of year 57,600
Cash at end of year $ 7,282

Tabl e I C 3 - 4 Statement of Cash Flows, 2008

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