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    Cash flows from operating, investing, and financing activities

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    The following information is available from Gray Co.'s accounting records for the year ended December 31, 2010 (amounts in million):

    Cash dividends declared and paid - $350
    Retirement of bonds payable at maturity - $200
    Interest and taxes paid - $150
    Proceeds of common stock issued - $550
    Proceeds from the sale of land - $125
    Collections from customers - $3,175
    Cash paid to suppliers and employees - ?
    Purchase of buildings and equipment - ?

    a) The net cash provided by operating activates for Gray Co. for the year ended December 31, 2010, is $1,225 million. Calculate the cash paid to suppliers and employees.
    b) The increase in cash for the year was $250 million. Calculate the amount of cash used to purchase buildings and equipment. 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.)

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    Solution Summary

    The expert examines cash flows for operating, investing and financing activities.