Following are the line items included in the 2009 statement of cash flows prepar
ID: 2351165 • Letter: F
Question
Following are the line items included in the 2009 statement of cash flows prepared by The Nine Muses, Inc. (amounts are in thousands):Proceeds from sale of long-term investments $14,077
Depreciation expense 8,275
Increase in accounts receivable 2,396
Increase in accounts payable 6,590
Purchase of long-term investments 29,939
Net income 22,214
Increase in accrued salaries 4,072
Proceeds from sale of property and equipment 2,468
Increase of inventories 7,320
Issuance of long-term notes 126
Reductions of long-term debt 572
Gain on disposal of long-term assets 415
Issuance of common stock 10,000
Cash and cash equivalents, beginning of the year 21,750
Increase in income taxes payable 5,608
Acquisitions of property and equipment 31,083
Net increase (decrease) in cash and cash equivalents ?
Cash and cash equivalents, end of year ?
Prepare The Nine Muses
Explanation / Answer
Operating cash flows: Net income 22,214 Depreciation expense +8,275 Increase in accounts receivable (2,396) Increase in accounts payable +6,590 Increase in accrued salaries +4,072 Increase of inventories (7,320) Gain on disposal of long-term assets (415) Increase in income taxes payable +5,608 Net cash flows from operating activities: 36,628 Investing cash flows: Proceeds from sale of long-term investments +14,077 Purchase of long-term investments (29,939) Proceeds from sale of property and equipment +2,468 Acquisitions of property and equipment (31,083) Net cash flows from investing activities: (44,477) Financing cash flows: Issuance of long-term notes +126 Reductions of long-term debt (572) Issuance of common stock +10,000 Net cash flows from financing activities: 9,554 Net cash flows for the period: 1,705 Cash and cash equivalents, beginning of the year 21,750 Ending cash balance: 23,455