(SOLVED) Top managers of Tranquility Inns are reviewing company performan


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$19

Top managers of Tranquility Inns are reviewing company performance for 2010. The income statement reports a 25% increase in net income over 2009. However, most of the increase resulted from an extraordinary gain on insurance proceeds from fire damage to a building.The balance sheet shows a large increase in receivables. The cash flows statement, in summarized form, reports the following:Net cash used for operating activities …………………. $(50,000)Net cash provided by investing activities…………….. 30,000Net cash provided by financing activities ……………. 25,000Increase in cash during 2010…………………………….. $ 5,000Requirement1. Write a memo giving Tranquility Inn’s managers your assessment of 2010 operations and your outlook for the future. Focus on the information content of the cash flows data.

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