Because of the dramatic growth at East Coast Yachts, Larissa decided that the company should be reorganized as a corporation. Time has passed and, today, the company is publicly traded under the ticker symbol “ECY”.
CASH FLOWS AT EAST COAST YACHTS
Because of the dramatic growth at East Coast Yachts, Larissa decided that the company should be reorganized as a corporation. Time has passed and, today, the company is publicly traded under the ticker symbol “ECY”.
Dan Ervin was recently hired by East Coast Yachts to assist the company with its short-term financial planning and also to evaluate the company’s financial performance. Dan graduated from college five years ago with a finance degree, and he has been employed in the treasury department of a Fortune 500 company since then.
EAST COAST YACHTS
2017 Income Statement
Sales $611,582,000
Cost of goods sold 431,006,000
Selling, general, and administrative 73,085,700
Depreciation 19,958,400
EBIT $ 87,531,900
Interest expense 11,000,900
EBT $ 76,531,000
Taxes 30,612,400
Net income $ 45,918,600
Dividends 17,374,500
Retained earnings $ 28,544,100
The company’s past growth has been somewhat hectic, in part due to poor planning. In anticipation of future growth, Larissa has asked Dan to analyze the company’s cash flows. The company’s financial statements are prepared by an outside auditor. Nearby you will find the most recent income statement and the balance sheets.
Larissa has also provided the following information. During the year, the company raised $40 million in new long-term debt and retired $22.6 million in long-term debt. The company also sold $24.2 million in new stock and repurchased $35.64 million. The company purchased $59.5 million in fixed assets, and sold $6,718,200 in fixed assets.
East Coast Yachts Balance Sheet
Larissa has asked Dan to prepare the statement of cash flows. She has also asked you to answer the following questions:
How would you describe East Coast Yachts’ cash flows?
Which cash flows statement more accurately describes the cash flows at the company?
In light of your previous answers, comment on Larissa’s expansion plans.
In addition to your responses to the 3 questions, be sure to also prepare and submit the statement of cash flows.
Collepals.com Plagiarism Free Papers
Are you looking for custom essay writing service or even dissertation writing services? Just request for our write my paper service, and we'll match you with the best essay writer in your subject! With an exceptional team of professional academic experts in a wide range of subjects, we can guarantee you an unrivaled quality of custom-written papers.
Get ZERO PLAGIARISM, HUMAN WRITTEN ESSAYS
Why Hire Collepals.com writers to do your paper?
Quality- We are experienced and have access to ample research materials.
We write plagiarism Free Content
Confidential- We never share or sell your personal information to third parties.
Support-Chat with us today! We are always waiting to answer all your questions.
