Essay About Given Income Statement And Balance Sheet Data

Chemco Coatings Case Study
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Question 1: Using the given income statement and balance sheet data, Ive generated a cash-based income statement for Chem-Co for 2005 below.
Chem-Co
Jennifer Haggerty
CASH BASED INCOME STATEMENT
$ 1,000,000
Cash Flow Impact
Net sales
Source
Revenue
Change in accounts receivable
(113)
Asset Increase
Cash receipts from sales
Cost of goods sold
(680)
Expense
Change in inventory
Asset Increase
Change in accounts payable
Source
Liability Increase
Cash purchases
(702)
Cash margin
Total operating expenses
(150)
Expense
Depreciation & amortization
Source
Noncash Expense
Change in prepaid expenses
Source
Asset Decrease
Change in accruals
Source
Liability Increase
Change in other current assets & liab.
Cash operating expenses
(114)
Cash operating profit
Interest on marketable securities
Source
Revenue
Income on long term investments
All other expenses & income (net)
Cash before interest & taxes
Interest expense – Bank notes
Interest expense – Term notes and LTD
Expense
Income taxes reported
Expense
Change in income tax payable
Source
Liability Increase
Change in deferred income taxes
Cash flow from operations (CFO)
Capital exp. and leasehold improvements
Asset Increase
Change in long-term investments
Change in intangible assets
Asset Increase
Change in other noncurrent assets
Cash Used for Investments
Payment for last periods CM Term note
Payment for last periods CMLTD
Payment For Financing
Dividends paid (DIV)
Payments for financing
Cash before external financing
(130)
Change in short-term bank debt
Source
Liability Increase
Change in term notes