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Question (5) Directions: Click the "Case-link" displayed above and use the information provided in Muebles Mexicanos, Parts B and D to answer this question: Which of these four choices was the largest source of cash in 2013? The change in accounts receivable The change in accrued expenses Dividends The change in short-term debt Muebles Mexicanos Part B Muebles Mexicanos Balance Sheets (In $000s) As At December 31: 2013 2012 2011 $ 62 $ 42 ASSETS Current assets Cash Accounts receivable Inventory Total current assets 51 135 28 317 210 316 173 243 Fixed assets Gross fixed assets Less: Accumulated depreciation Net fixed assets Other noncurrent assets TOTAL ASSETS 597 393 $ 314 $ 177 $ 103 LIABILITIES AND EQUITY Current liabilities Short-term debt Current portion-LTD Accounts payable Accrued expenses Other current liabilities Total current liabilities 104 76 Long-term debt Total liabilities Owners' equity 225 166 TOTAL LIABILITIES AND EQUITY $ 597 $ 393 $ 314 Muebles Mexicanos Part B Muebles Mexicanos Income Statements (In S000s) Years Ended December 31: 2093 2012 2011 $ $ 1.500 $ Sales Cost of goods sold Gross profit 2,722 1.068 1.281 512 1,654 769 1,307 Selling general, and administrative expense Depreciation expense Total SG&A expenses 1.347 Interest expense Loss on sale of fixed assets Other expenses Income before taxes Taxes Net Income Dividends Retained earnings $ 59 $ 41 $ Muebles Mexicanos Part B Muebles Mexicanos Statement of Cash Flow (In $000s) Year Ended December 31, 2013 OPERATING ACTIVITIES Net income Adjustments to reconcile net income to net cash provided (used) by operating activities Depreciation Loss on disposition of fixed assets Changes in: Accounts receivable Inventory Other noncurrent assets Accounts payable Accruals Other current liabilities Net cash provided by (used in) operating activities (91) (107) (5) 34 ON INVESTING ACTIVITIES (Purchases) of fixed assets Proceeds of sale of fixed assets Net cash provided by (used in) investing activities (60) FINANCING ACTIVITIES Proceeds from short-term borrowing (Payments) on long-term debt Cash dividends (paid) Net cash provided by (used in) financing activities Increase (Decrease) In cash and cash equivalents Beginning cash and cash equivalents Ending cash and cash equivalents $ 51 Muebles Mexicanos Part C Furniture Retailers Industry Data 2013 2012 2011 1.8 % BALANCE SHEETS Current assets Cash and equivalents Accounts receivable Inventory Other current assets Total current assets 11.3 3.2 % 10.4 472 *9388 3 2.5 % 10.7 53.1 1.5 67.8 52.5 0.9 66.5 65.2 Fixed assets (net) 31.8 30.4 33.5 Other noncurrent assets 1.7 1.8 TOTAL ASSETS 27.4 2.4 Current liabilities Short-term debt Current maturities LTD Accounts payable Accrued expenses Total current liabilities 27.1 2.6 18.1 10.0 57.8 25.8 2.8 15.8 8.9 53.3 172 9.1 56.1 Long-term debt Other noncurrent liabilities Total llabilities 4.6 1.0 63.4 5.1 1.2 59.6 61.2 Equity and reserves 36.6 40.4 38.8 TOTAL LIABILMES AND EQUITY 100.0 % 100.0 % 100.0 % 2043 2012 2011 100.0 % INCOME STATEMENTS Net sales Cost of goods sold Gross profit 100.0 % 23.4 100.0 % 22.7 24.0 76.0 Operating expenses Operating profit All other expenses Income before taxes RATIOS AND INDICATORS Current ratio (range) Accounts receivable DOH (range) Inventory DOH (range) 1.0-1.6 - 3.0-24.0 73-157 1.1-1.7 2.0-17.0 68-151 1.1-1.5 3.0-20.0 79-152

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