Hindsville Company Reported Revenues of $165,000 and Net Income of $20,000

question 61

Essay

Hindsville Company reported revenues of $165,000 and net income of $20,000 for 2014. Cash generated by operations was $40,000. In addition, Hindsville Company borrowed $24,000 from a bank. During 2014, Hindsville purchased new equipment for $30,000 cash and paid cash dividends of $15,000 to stockholders. Hindsville's cash balance at the beginning of 2014 was $22,000.
A Identify the amount of cash flows for financing, investing, and operating activities for 2014 by filling in the amounts below.
Financing Cash Flows: Investing Cash Flows: Operating Cash Flows:
B Did Hindsville Company's operating activities generate enough cash to cover its investing and financing activities? Explain.
C How much did Hindsville Company's cash balance increase or decrease during 2014?

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Definitions:

Aggregate Consumption

The total amount of goods and services consumed in an economy, often used to analyze economic health and growth.

Consumption Function

A concept in economics that calculates the expected total consumption of goods and services by individuals at different income levels.

Aggregate Income

The total amount of income generated by all individuals and entities in an economy over a specific period.

Aggregate Consumption

Aggregate consumption is the total amount of goods and services consumed in an economy, reflecting overall consumer spending.