Question

that is all i get for the question, maybe the 2019 just a typing error just consider 2019 as 2020, thanks

Using U.S. Composite Corporation’s 2019 financials, the income statement below and the additional information provided, solve for the following 2020 financial information:

a.) Calculate U.S. Composite Corporation’s 2020 Statement of Cash Flow (including Cash Flow from Assets and Cash Flows to Creditors and Stakeholders) using the following data:

Income Statement (US$ in millions) 2020 $ 2,375 $ 1,766 $ 338 Total operating revenues Cost of goods sold Selling, general and admin exp $ $ $ $ 100 171 32 203 Depreciation Operating income Other income Earnings before int & tax (EBIT) Interest expense Pre-tax income Taxes Current Deferred Net income Addition to retained earnings Dividends $ $ $ 139 30 19 $ $ 66 43 Current liabilities: Accounts payable $515 2020 Current Assets & Liabilities Current assets: Cash and equivalents Accounts receivable Inventories Total current assets: $254 $309 $246 $809 Total current liabilities: $515

In addition, during 2020 U.S. Composite Corporation purchased $250 in new fixed assets and sold $45 in fixed assets. It also borrowed $150 in new long-term debt and retired $80 in debt, and repurchased $19 in equity and issued no new equity.

b.) Using the income statement, cash flow statement you derived in a.) and the above information, solve for the remaining entries in U.S. Composite Corporation’s 2020 balance sheet. What are U.S. Composite Corporation’s total assets at the end of 2020?

Answer 1

Statement of Cash flow of US Composite Corporation for 2020
Cash flow from Operating activities
Profit after tax	109
Add : Depreciation	100
Cash flow from Operating activities		209
Cash flow from Investing Activities
Fixed Assets Sold	45
Fixed Asset purchased	-250
Cash flow from Investing Activities		-205
Cash flow from Financing activities
Issue of long term debt	150
Retired old debt	-80
Cash flow from Financing activities		70
Net Increase in cash and cash equivalents during the year		74
Add :Opening Cash and cash equivalents		246
Cash and Cash equivalents at the end of the year		320

Total Assets of US Composit Corporations at the end of 2020
Current Assets	US $ in Million
Cash and Cash equivalents	119
Account receivables	309
Inventories	246
Total Current Assets	674
Fixed Assets	250
	924

Working note
Cash Account
Particulars	Amount	Particulars	Amount
To balance b/d	254	By Fixed Assets	250
To Fixed Assets	45	By Disposal of Long term debt	80
To Long term debt	150	By Balance c/d	119
	449		449
Explanations
We assume that Old Fixed Assets of $ 45 M were sold during the year and Purchased Fixed Assets
of $ 150 M. This has been shown here.
We assume that Long term debt at the year end is 150 M as Old debt of $ 80 M has been paid off