Question: Using these balance sheets, compute working capital. Provide your analysis regarding working capital.
Apex Printing Balance Sheets As of December 31, 2013 and 2012
|
|
|
|
|
000$ |
000$ |
|
|
Assets |
|
2013 |
2012 |
| Cash |
|
|
|
6,000 |
5,700 |
| Accounts Receivable |
|
2,350 |
2,300 |
| Inventory |
|
|
12,100 |
6,500 |
| Total Current Assets |
|
20,450 |
14,500 |
| Land |
|
|
|
25,000 |
20,000 |
| Building & Equipment |
|
300,000 |
300,000 |
| Less: Accumulated Depreciation - Building & Equipment |
187,850 |
160,000 |
| Total Long Term Assets |
|
137,150 |
160,000 |
| Total Assets |
|
|
157,600 |
174,500 |
| Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
| Accounts Payable |
|
|
4,600 |
3,500 |
| Salaries Payable |
|
|
0 |
2,100 |
| Interest Payable |
|
|
1,500 |
0 |
| Short Term Notes Payable |
|
12,000 |
0 |
| Taxes Payable |
|
|
0 |
5,600 |
| Total Current Liabilities |
|
18,100 |
11,200 |
| Mortgate Payable |
|
|
54,950 |
100,000 |
| Total Long Term Liabilities |
|
54,950 |
100,000 |
|
|
|
|
|
|
| Common Stock |
|
|
60,000 |
60,000 |
| Retained Earnings |
|
|
24,550 |
3,300 |
| Total Stockholders' Equity |
|
84,550 |
63,300 |
| Total Liabilities and Stockholders' Equity |
157,600 |
174,500 |
|
|
Apex Printing |
|
|
|
|
Income Statements |
|
|
|
|
For the Periods Ended December 31, 2013 and 2012 |
|
|
|
|
000$ |
000$ |
|
|
|
|
2013 |
2012 |
| Revenue: |
|
|
450,000 |
475,000 |
| Less: Cost of Goods Sold |
|
324,300 |
374,500 |
| Less: Depreciation Expense |
|
27,850 |
26,000 |
| Gross Margin |
|
|
97,850 |
74,500 |
| Selling, General & Administrative Expenses |
29,100 |
32,000 |
| Income Before Interest & Taxes |
68,750 |
42,500 |
| Interest Expense |
|
|
7,500 |
6,000 |
| Income Before Taxes |
|
61,250 |
36,500 |
| Income Taxes |
|
|
35,000 |
30,000 |
| Net Income |
|
|
26,250 |
6,500 |
|
|
Apex Printing |
|
|
|
|
|
Statement of Cash Flows |
|
|
|
|
For the Period Ended December 31, 2013 |
|
|
|
|
|
000$ |
|
| Cash Flows from Operating Activities: |
|
|
|
| Net Income |
|
|
|
26,250 |
|
| Adjustments to reconcile net income to net cash provided by operating activities |
| Depreciation Expense |
|
|
27,850 |
|
| Increase in accounts receivable |
|
50 |
|
| Increase in inventory |
|
|
5,600 |
|
| Decrease in salaries payable |
|
|
2,100 |
|
| Increase in interest payable |
|
|
1,500 |
|
| Decrease in taxes payable |
|
|
5,600 |
|
| Increase in Short Term notes Payable |
|
12,000 |
|
| Increase in accounts payable |
|
|
1,100 |
|
| Net Cash Flow from Operating Activities |
|
|
55,350 |
| Cash Flows from Investing Activities: |
|
|
|
| Cash paid to purchase land |
|
|
5,000 |
|
| Net Cash Flow from Investing Activities |
|
|
5,000 |
|
|
|
|
|
|
|
| Cash Flows From Financing Activities: |
|
|
|
| Cash paid for mortgage |
|
|
45,050 |
|
| Cash paid for dividends |
|
|
5,000 |
50,050 |
|
|
|
|
|
|
|
| Net Increase in Cash |
|
|
|
300 |
| Plus: Cash Balance at December 31, 2012 |
|
5,700 |
| Cash Balance at December 31, 2013 |
|
|
6,000 |
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