Week 4 EOC: Chapter 5 Quiz Question 2

a. Did the change in Cash reflect a Source or a Use of funds? What was the amount of that change?

b. Did the change in Net Receivables reflect a Source or a Use of funds? What was the amount of that change?

c. Did the change in Notes Payable reflect a Source or a Use of funds? What was the amount of that change?

d. Did the change in Retained Earnings reflect a Source or a Use of funds? What was the amount of that change?

e. What was the total amount of Sources and Uses of Funds?

Answers: 

a.  The Change in Cash reflected an increase of 14000 and was a Use.

Sources and Uses- inflows and outflows of money affecting the cash position.

b.  the change in Net Receivables reflected an increase of 30,000 and is a Use.

Net Receivables- Something that has been subtracted out. Are those monies owned to the business after subtracting any amounts that may not be collectible.

c.  The change in Notes Payable reflected a decrease of 44,000 and was a use. 

Notes Payable- Is classified as a current liabilities, are defined as those obligations of the business that will be repaid within a year.

d.  The change in Retained Earnings reflect a increase of 104,000 and was a source.

Retained Earnings- The accumulated amount of profits over the life of the business that have not been distributed as dividends.

e.    The total amount of Sources and Uses of funds was 743,000