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3 March, 12:00

The 2014 balance sheet of Sugarpova's Tennis Shop, Inc., showed long-term debt of $2.5 million, and the 2015 balance sheet showed long-term debt of $2.65 million. The 2015 income statement showed an interest expense of $100,000. What was the firm's cash flow to creditors during 2015? The 2014 balance sheet of Sugarpova's Tennis Shop, Inc., showed long-term debt of $2.5 million, and the 2015 balance sheet showed long-term debt of $2.65 million. The 2015 income statement showed an interest expense of $100,000. What was the firm's cash flow to creditors during 2015?

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Answers (2)
  1. 3 March, 12:08
    0
    50000

    Explanation;

    The 2014 balance sheet of Sugarpova's Tennis Shop, Inc., showed long-term debt of $2.5 million, and the 2015 balance sheet showed long-term debt of $2.65 million. The 2015 income statement showed an interest expense of $100,000. What was the firm's cash flow to creditors during 2015?

    Particulars Amount$

    Interest Paid (a) 100,000

    Less

    Net new borrowings

    Long Term debt at the end Of 2015 2650000

    Less:Long Term debts in the beginning 2500000

    Net new borrowings (b) 150000

    Cash flow to creditors (a) - (b) 50000

    cash flow to credits during 2015 is 50000
  2. 3 March, 12:09
    0
    Total CashFlow to creditors : ($50.000).

    Explanation:

    Total Cash flow to creditors it's = I - E + B, where I it's Interest, E it's Ending Long Term Debt and B it's Beginning Long Term Debt.

    With this, it means we get money from creditors instead of a payment to them.
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