Question

Presented below are the financial statements for the Amphlett Corporation, as of year-end 2012 and 2013.

AMPHLETT CORPORATION
Consolidated Balance Sheets
As of Year-End ($ thousands) 2013 2012
Assets
Current
Cash $18,000 $108,000
Marketable securities 240,000 -
Accounts receivable (net) 708,000 528,000
Inventory 720,000 738,000
Total current assets 1,686,000 1,374,000
Noncurrent
Long-term investments 372,000 468,000
Property & equipment 2,160,000 1,320,000
Less: Accumulated depreciation (600,000) (600,000)
Property & equipment (net) 1,560,000 720,000
Intangibles (net) 114,000 126,000
Total noncurrent assets 2,046,000 1,314,000
Total assets $3,732,000 $2,688,000
Liabilities & Shareholders' Equity
Accounts payable $1,080,000 $1,020,000
Short-term bank debt 228,000 -
Total liabilities 1,308,000 1,020,000
Shareholders' equity
Common stock, $10 par value 930,000 810,000
Additional paid-in-capital 456,000 360,000
Retained earnings 1,038,000 498,000
Total shareholders' equity 2,424,000 1,668,000
Total liabilities & shareholders' equity $3,732,000 $2,688,000
AMPHLETT CORPORATION
Consolidated Income Statement
For Year Ended ($ thousands)
2013
2012
Revenues
$1,716,000
$1,440,000
Less: Cost of goods sold
600,000
504,000
Gross margin
1,116,000
936,000
Less: Selling, general & administrative expenses
180,000
144,000
Operating income
936,000
792,000
Gain on sale of investments
84,000
-
Net income before taxes
1,020,000
792,000
Less: Income taxes
60,000
13,200
Net income after taxes
$960,000
$778,800
The footnotes to the Amphlett Corporation's financial statements revealed the following additional information:
Property and equipment costing $540 million was sold for its book value of $240 million.
Long-term investments were sold for $180 million, which included a gain of $84 million.
Required
Using the above financial data for the Amphlett Corporation, prepare the firm's statement of cash flow for 2013 using the indirect method.
Use a negative sign with answers to indicate a decrease in cash.
Amphlett Corporation
Statement of Cash Flows
For Year Ended 2013
(in thousands)
Cash flow From Operations BLANK
Net Income $Answer
Add:
Depression Expense Answer
Amortization expense Answer
Less:
Gain on Sale of Investments Answer
Accounts receivable (net) Answer
Inventory Answer
Accountable Payable Answer
Cash Flow From Operations Answer
Cash Flow for Investing BLANK
Marketable securities Answer
Long-term investments Answer
Purchase of property and equipment Answer
Sale of Property and Equipment Answer
Cash Flow for Investing Answer
Cash From Financing BLANK
Short-term bank debt Answer
Common stock + additional paid in capital Answer
Dividends Paid Answer
Cash From Financing Answer
Decrease in Cash Answer
Cash, beginning of year Answer
Cash, end of year $Answer

Answer 1

For Year Ended 2013

(in thousands)

Cash flow From Operations BLANK

Net Income 792,000

Add:

Depression Expense 300,000

Amortization expense 12,000

Less:

Gain on Sale of Investments

Accounts receivable (net) -180,000

Inventory 18,000

Accountable Payable Answer 60,000

Cash Flow From Operations 1,002,000

Cash Flow for Investing

Marketable securities -240,000

Long-term investments 96,000

Purchase of property and equipment -1,380,000

Sale of Property and Equipment 280,000

Cash Flow for Investing -1,244,000

Cash From Financing

Short-term bank debt 228,000

Common stock + additional paid in capital 96,000

Dividends Paid 8,000

Cash From Financing 332,000

Decrease in Cash 90,000

Cash, beginning of year 18,000

Cash, end of year 108,000

108,000

0

Explanation:

Assets

Current

Cash $18,000 $108,000

Marketable securities 240,000

Accounts receivable (net) 708,000 528,000

Inventory 720,000 738,000

Total current assets 1,686,000 1,374,000

Noncurrent

Long-term investments 372,000 468,000

Property & equipment 2,160,000 1,320,000

Less: Accumulated depreciation -600,000 -600,000

Property & equipment (net) 1,560,000 720,000

Intangibles (net) 114,000 126,000

Total noncurrent assets 2,046,000 1,314,000

Total assets $3,732,000 $2,688,000

Liabilities & Shareholders' Equity

Accounts payable $1,080,000 $1,020,000

Short-term bank debt 228,000

Total liabilities 1,308,000 1,020,000

Shareholders' equity

Common stock, $10 par value 930,000 810,000

Additional paid-in-capital 456,000 360,000

Retained earnings 1,038,000 498,000

Total shareholders' equity 2,424,000 1,668,000

Total liabilities & shareholders' equity $3,732,000 $2,688,000

AMPHLETT CORPORATION

Consolidated Income Statement

For Year Ended ($ thousands) 2013 2012

Revenues $1,716,000 $1,440,000

Less: Cost of goods sold 600,000 504,000

Gross margin 1,116,000 936,000

Less: Selling, general & administrative expenses 180,000 144,000

Operating income 936,000 792,000

Gain on sale of investments 84,000

Net income before taxes 852,000 792,000

Less: Income taxes 60,000 13,200

Net income after taxes $792,000 $778,800

For Year Ended 2013

(in thousands)

Cash flow From Operations BLANK

Net Income 792,000

Add:

Depression Expense 300,000

Amortization expense 12,000

Less:

Gain on Sale of Investments

Accounts receivable (net) -180,000

Inventory 18,000

Accountable Payable Answer 60,000

Cash Flow From Operations 1,002,000

Cash Flow for Investing

Marketable securities -240,000

Long-term investments 96,000

Purchase of property and equipment -1,380,000

Sale of Property and Equipment 280,000

Cash Flow for Investing -1,244,000

Cash From Financing

Short-term bank debt 228,000

Common stock + additional paid in capital 96,000

Dividends Paid 8,000

Cash From Financing 332,000

Decrease in Cash 90,000

Cash, beginning of year 18,000

Cash, end of year 108,000

108,000

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