Reference no: EM13513706
Newport Steam Corporation's balance sheet accounts as of December 31,19X8, and December 31, 19x9, and the information relating to the 19x9 activities, are presented below.
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December 31
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19x9
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19x8
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ASSETS
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Cash
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$ 230,000
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$ 100,000
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Short-Term Investments
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300,000
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0
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Accounts Receivable (net)
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550,000
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550,000
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Inventory
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680,000
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600,000
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Long-Term Investments
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200,000
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300,000
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Plant Assets
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1,700,000
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1,000,000
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Accumulated Depreciation
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(450,000)
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(450,000)
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Goodwill
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90,000
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100,000
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Total Assets
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$3,300,000
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$2,200,000
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LIABILITIES AND STOCKHOLDERS' EQUITY
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Accounts Payable
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$ 825,000
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$ 720,000
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Long-Term Debt
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325,000
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0
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Common Stock, $1 Par
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800,000
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700,000
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Additional Paid-in Capital
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370,000
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250,000
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Retained Earnings
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980.000
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530,000
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Total Liabilities and Stockholders' Equity
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$3,300,000
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$2,200,000
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Information relating to 19x9 activities is as follows:
(1) Net income for 19x9 was $700,000.
(2) Purchase of short-term investments for $300,000, which will mature on 30, 20 0.
(3) Cash dividends declared and paid in 19x9 worth $250,000.
(4) Equipment costing $400,000, having accumulated depreciation of $250,000, was sold in 19x9 for $150,000.
(5) Plant assets worth $1,100,000 were purchased for cash.
(6) A long-term investment costing $100,000 was sold for $135,000.
(7) 100,000 shares of $1-par-value common stock were sold for $2.20 a share.
(8) Amortization of goodwill for 19x9 was $10,000.
Calculate Newport's net cash inflows or outflows for (a) operating, (b)investing, and (c) financing activities. Discuss whether or not the short-term investments are cash equivalents.