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$5,000 3. Given the following balance sheets and income statement for Genesis Enterprises, Inc.: a. Develop a cash flow statement. b. Discuss why the cash position of the company is different from the profit of the company. Specifically, note that net profit was $425, but the cash account stayed the same. Cash Accounts receivable Inventory Fixed assets (Accumulated depr.) Total GENESIS ENTERPRISES, INC. BALANCE SHEET - 12/31/12 1000'S) $500 Accounts payable 750 Operating accruals 400 Debt 1,000 Common stock 400 Retained earnings $2,250 Total $200 300 1,000 500 250 $2,250 Cash Accounts receivable Inventory Fixed assets (Accumulated depr.) Total GENESIS ENTERPRISES, INC. BALANCE SHEET - 12/31/13 (000'S) $500 Accounts payable 2,000 Operating accruals 600 Debt 1,000 Common stock 700 Retained earnings $3,400 Total $950 275 1,000 500 675 $3,400 GENESIS ENTERPRISES, INC. INCOME STATEMENT 1/01/13-12/31/13 Sales $9,000 Cost of goods sold 4,500 Gross profit 4,500 Operating expenses: Salaries, Advertising, etc. 3,500 Depreciation 300 Operating profit 700 Interest 100 Taxes 175 Net profit 425 Dividends Addition to retained earnings Given the following balance sheets and income statement for Crestin International, Inc.: a. Develop a cash flow statement. b. Explain why the cash balance increased by $350 when the company generated a net profit of $405. 0 425 CRESTIN INTERNATIONAL, INC. BALANCE SHEET - 12/31/11 (000's) Cash $200 Accounts payable Accounts receivable 800 Operating accruals Inventory 250 Debt Fixed assets 1,000 Common stock (Accumulated depr.) 400 Retained earnings Total $1,850 Total $200 300 750 400 200 $1,850 24 Short-Term Financial Management CRESTIN INTERNATIONAL, INC. BALANCE SHEET - 12/31/12 (000'S) Cash $550 Accounts payable Accounts receivabl Be 700 Operating accruals Inventory 150 Debt Fixed assets 1,000 Common stock (Accumulated depr.) 600 Retained earnings Total $1,800 Total $250 150 395 400 605 $1,800 CRESTIN INTERNATIONAL, INC. INCOME STATEMENT 1/1/12-12/31/12 Sales $4,500 Cost of goods sold 2,200 Gross profit 2,300 Operating expenses: Salaries, Advertising, etc. 1,300 Depreciation 200 Operating profit 800 Interest 75 Taxes 320 Net profit 405 Dividends 0 Addition to retained earnings 405 998 male

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