Investing and financing activities-direct method

Reference no: EM131101829

Cash flows from operating, investing, and financing activities-direct method The following information is available from Gray Co.'s accounting records for the year ended December 31, 2013 (amounts in millions):

Cash dividends declared and paid. . . . . . . . . . . . . . . . . . . . . . .	$1,050
Retirement of bonds payable at maturity . . . . . . . . . . . . . . . . . .	600
Interest and taxes paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	450
Proceeds of common stock issued . . . . . . . . . . . . . . . . . . . . . .	1,650
Proceeds from the sale of land . . . . . . . . . . . . . . . . . . . . . . . . .	375
Collections from customers . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9,525
Cash paid to suppliers and employees . . . . . . . . . . . . . . . . . . .	?
Purchase of buildings and equipment . . . . . . . . . . . . . . . . . . . .	?

Required:

a. The net cash provided by operating activities for Gray Co. for the year ended December 31, 2013, is $3,675 million. Calculate the cash paid to suppliers and employees.

b. The increase in cash for the year was $750 million. Calculate the amount of cash used to purchase buildings and equipment. Your answer to part a should be considered in your calculation. (Hint: Set up a model of the statement of

cash flows to determine the net cash provided [used] by operating and investing activities, and then solve for the missing amounts.)

Reference no: EM131101829

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