For the Year Ended December 31, 2007 Revenue:
Net sales...............................................$2,850,000
Dividend income...................................... 104,000
Interest income........................................ 70,000
Gain on sales of marketable securities....... 4,000
Total revenue and gains......................$3,028,000
Costs and expenses:
Cost of goods sold................................. $1,550,000
Operating expenses..............................980,000
Interestexpense................................. 185,000
Income tax expense........................... 90,000
Total costs and expenses.............. 2,805,000
Netincome.................................................... $223,000
End ofYear Beginning of Year
Selected account balances:
Accounts receivable............................... $650,000 $ 720,000
Accrued interest receivable.....................9,000 6,000
Inventories...........................................800,000 765,000
Short-term prepayments......................20,000 15,000
Accounts payable(merchandise suppliers)..570,000 562,000
Accrued operating expenses payable.........65,000 94,000
Accrued interest payable...........................21,000 12,000
Accrued income taxes payable...................22,000 35,000
Dividend revenue is regonized on cash basis.Operating expenses include depreciation expense of$115,000
Question: Prepare a partial statement of cashflows, including only the operating activites section using thedirect method, using brackets to show cash payments. Show; cash received from customers, interest and dividends received, cash paid to suppliers and employees, interest paid, and income taxpaid.
The company looking to increase the cash flow from operations. One way is to more aggressively collect on receivables. Assuming that management has already all the steps possible to increase revenue and reduce expenses. Describe 2 other ways that cash flows from operations could be increased.