Using the excerpt from the Animal World Company statement of cash ...

[pragya sharda]

Using the excerpt from the Animal World Company statement of cash flows analyze thoroughly the cash flow from operating activities. Be sure to offer possible reasons for the changes identified.
 
  Operating Activities 2015 2014
  Net income (2,800) (9,800)
  Depreciation and amortization 21,800 21,700
  Loss on disposal of property and equipment 11,000 3,100
  Increase (decrease) in cash resulting from changes in:
   Accounts receivable (10,100) (9,200)
   Inventories (35,500) (56,500)
   Accounts payable and accrued expenses 54,700 24,200
  Net cash provided (used) by operating activities 39,100 (26,500)
 
 
 
 What will be an ideal response?

Question 2

By January 31, an employer must furnish all employees with a Form W-4.
  Indicate whether the statement is true or false

[eliasc0401]

Answer to Question 1

Animal World Company has been operating at a loss in both 2014 and 2015 . Cash flow from operating activities (CFO) was negative and far worse than the net loss in 2014; however, in 2015, CFO improved to a positive and much larger amount than the net loss for 2015 . Accounts receivables, inventories and accounts payable and accrued expenses have increased both years. The large increase in inventories was the main cause of the negative CFO in 2014 . In 2015, CFO was positive due to the large increase in accounts payable and accrued expenses as well as a loss on the disposal of property and equipment. If Animal World is expanding and is able to sell down inventories and collect accounts receivable they should be able to pay off accounts payable and accrued expenses.

Answer to Question 2

F

[pragya sharda]

Excellent

[helenmarkerine]

Thanks for the timely response, appreciate it