Closing case: East Coast Yachts

Closing Case: East Coast Yachts Student’s Name Institution Course Number and Name Instructor’s Name Date Closing Case: East Coast Yachts Question 1 A cash flow statement is integral in understanding the financial health of a company. Given the balance sheet and income statement of East Coast Yachts (ECY) provided in the case, one can develop a cash flow statement to better understand what happened to the company's cash between 2022 and 2023. From the balance sheets of 2022 and 2023, one can discern that there was an increase in cash and cash equivalents of $476,200 (Ross et al., 2023). However, with the statement of cash flow developed below, a detailed picture of the flow of cash can be analyzed. Despite the company investing heavily ($48,150,000) in acquiring fixed assets, it still managed to have positive cash flows during the period. ECY’s positive cash flow indicates that the firm has more cash inflows than outflows. This means it has excess cash that can be used to settle debts, reinvest in itself, and grow the organization (Stobierski, 2020). Therefore, given the company's positive cash flow during the period, it is accurate to say it is financially healthy. East Coast Yachts Statement of Cash Flow in 2023 Operations Net income $40,228,575 Depreciation 16,166,700 Changes in current assets & liabilities Accounts receivable 197,600 Inventories -2,478,300 Other -60,200 Accounts payable 1,826,075 Accrued expenses 763,...