Finance Accounting

timer Asked: Nov 6th, 2015

Question description


Owners of a business are contemplating investing $550,000 in non-current assets in early January 2014.

They are exploring ways to finance it.

In 2012, the company had $250,000 in trade receivables, an amount that it expects will increase to $275,000 in 2013.

The inventory level for 2012 was $430,000 and, having introduced a new inventory management system, the owners expect to be more efficient in managing it.

They forecast a level of $370,000 in inventories by the end of 2013.

They expect a substantial increase in revenue, which will increase their profit from $150,000 in 2012 to $230,000 in 2013.

1.How much cash will be generated from internal operations by the end of 2013?

2.Will the owners have to borrow money from investors to finance the expansion? If yes, how much?


Indicate under which activity (operating, financing, and investing) the following accounts belong in the statement of cash flows:


Trade receivables______________________


Mortgage payable______________________

Profit for the year______________________

Trade and other payables______________________



Prepaid expenses______________________

Share capital (common)______________________


Accrued expenses______________________

Current taxes payable______________________


Long-term borrowings______________________

Purchase of a company______________________


Share capital (preferred) ______________________


Copy and complete the following assignment into a new document. As this assignment is problem-based, no 2-3 page paper or ppts will be required. However, you should provide a summary that explains sources of finance, and other accounting principles learned thus far.

 (in $)  House  134,600  130,000__________________

Trailer 12,000 -- __________________

Furniture 5,600 4,000__________________

Salary in excess of expenses 5,000 --__________________

Mortgage 75,000 60,000__________________

RRSP 23,000 20,000__________________

Loan made to a friend -- 5,000__________________

Car loan 12,000 8,000__________________

Visa 1,250 600__________________

The Bay -- 450__________________

Cash in the bank 3,000 2,000__________________

Marketable securities 12,000 10,000__________________


Tutor Answer

(Top Tutor) Studypool Tutor
School: University of Virginia
Studypool has helped 1,244,100 students
flag Report DMCA
Similar Questions
Hot Questions
Related Tags
Study Guides

Brown University

1271 Tutors

California Institute of Technology

2131 Tutors

Carnegie Mellon University

982 Tutors

Columbia University

1256 Tutors

Dartmouth University

2113 Tutors

Emory University

2279 Tutors

Harvard University

599 Tutors

Massachusetts Institute of Technology

2319 Tutors

New York University

1645 Tutors

Notre Dam University

1911 Tutors

Oklahoma University

2122 Tutors

Pennsylvania State University

932 Tutors

Princeton University

1211 Tutors

Stanford University

983 Tutors

University of California

1282 Tutors

Oxford University

123 Tutors

Yale University

2325 Tutors