Reference no: EM131785979

MANAGEMENT CASE ASSIGNMENT: Cash Flow Statement Analysis

The following is Crash Zone Corporation's balance sheet at the end of 2013 and its cash flow statement for 2014. Crash Zone manufactures safety equipment for race cars.

The following is the balance sheet for Crash Zone for 2013.

Crash Zone Corp.
Balance Sheets                                                                     December 31
                                                                                           2013
Assets Current assets
Cash                                                                                    $ 8,250
Accounts receivable - net                                                       7,110
Inventory                                                                             14,221
Prepaid assets                                                                      1,850
Total current assets                                                              31,431
Land                                                                                    30,278
Buildings and equipment                                                        222,665
Less: Accumulated depreciation, buildings and equipment          (41,115)
Total assets                                                                          $ 243,259
Liabilities and Stockholders' Equity Current liabilities
Accounts payables                                                                 $ 13,500
Accrued expenses                                                                  4,888
Total current liabilities                                                             18,388
Long-term debt                                                                     31,500
Stockholders' equity
Common stock, $10.00 par value                                            21,552
Paid-in-capital                                                                       45,002
Retained earnings                                                                 146,872
Less: Treasury stock                                                             (20,055)
Total liabilities and stockholders' equity                                    $ 243,259

The following is the statement of cash flows for 2014:

Crash Zone Corp.
Cash Flow Statements
For the year ended December 31, 2014
Operating Activities
Net Income	$ 15,750
Plus (minus) noncash items:
Depreciation expense	6,210
Plus (minus) changes in current asset and liability accounts
- Increase in inventory	(350)
+ Decrease in prepaid assets	102
Decrease in accrued expenses	(655)
- Increase in accounts receivable	(3,178)
- Decrease in accounts payable	(1,230)
Cash provided by operating activities	$ 16,649
Investing Activities
Purchase of equipment	$ (27,910)
Proceeds from the sale of land	6,555
Cash used by investing activities	$ (21,355)
Financing Activities
Issuance of long-term debt	$ 8,900
Issuance of common stock	23,000
Cash dividends paid	(12,200)
Purchase of treasury stock	(7,513)
Cash provided by financing activities	$ 12,187
Net cash flow	$ 7,481

Additional information:

a. During 2014, 500 shares of common stock were sold to the public.
b. Land was sold during 2014 at an amount equal to its original cost.

Required:

Use the preceding information to derive Crash Zone's balance sheet at the end of 2014.