BandalCorporation had operating cash ﬂows of $400, ending ﬁxed asset value of $300, change in net working capital of $80, depreciation of $80, cash ﬂow from assets of $190. Given this
Information, determine the beginning value of ﬁxed assets.

Question

Quizplus · Accepted Answer

Cash flow from assets = Operating cash flows - Cash flow to fixed assets
Cash flow to fixed assets = Depreciation + Change in fixed assets
Cash flow to fixed assets = $80 + (Ending fixed assets - Beginning fixed assets)
Cash flow from assets = $190
Operating cash flows = $400
Depreciation = $80
Change in net working capital = $80
$190 = $400 - Cash flow to fixed assets
Cash flow to fixed assets = $210

$210 = $80 + (Ending fixed assets - Beginning fixed assets)
$130 = Ending fixed assets - Beginning fixed assets
Ending fixed assets = $300
$130 = $300 - Beginning fixed assets
Beginning fixed assets = $170
Therefore, the beginning value of fixed assets is $250 (Option B)

BandalCorporation Had Operating Cash ﬂOws of $400, Ending ﬁXed Asset