Operating Activities Section of Benton Island, Inc. for the Year Ended December 31, 2018

How did Benton Island, Inc. fare in terms of its operating activities for the year 2018?

What were the key cash inflows and outflows from operating activities during the year?

Operating Activities Section of Benton Island, Inc. for the year ended December 31, 2018 (using the direct method):

Cash from customers $80,000

Cash to Suppliers -$85,000

Cash to Employees -$50,000

Income Taxes -$11,000

Net Cash flow from Operating Activities: -$66,000

Benton Island, Inc. had a mix of cash inflows and outflows from their operating activities in the year 2018. The company started with $70,000 in cash and went on to earn revenue of $180,000, collecting $80,000 from customers. They also incurred expenses totaling $159,000 during the year. To suppliers, Benton Island paid $85,000 in cash and $50,000 in cash to employees. Additionally, the company received $1,800 in cash for interest revenue and paid $11,000 for income taxes.

The net cash flow from operating activities for Benton Island, Inc. was -$66,000. This negative figure indicates that the company had more cash outflows than inflows from its core business operations throughout the year. Despite the challenges faced, Benton Island, Inc. continued to invest in its equipment with a cash outlay of $30,000 and also distributed $12,000 in cash dividends to its stockholders.

It is essential for companies to closely monitor their operating activities as they form the foundation of the business. By analyzing these cash flows, organizations like Benton Island, Inc. can evaluate their financial health, make strategic decisions, and ensure sustainable growth in the long run.