Assignment: Candela Corporaion Case...Acc 260

Assignment: Candela Corporation Case

      Using the Consolidated Statements of Cash Flows, prepare a summary analysis for the years ended July 3, 2004, June 28, 2003, and June 29, 2002. Analyze the cash flows for the Candela Corporation, Inc. for all three years.

    While looking at the Consolidated Statements of Cash Flows for the Candela Corporation for 2004, 2003, and 2002, it is quite easy to see that the corporation is undergoing or has undergone many changes in these short three years.


    In 2004, the cash flow from operations was $1,132 is much lower than the net income of $8,119. This may be due to the increase of Accounts Receivable of $7,663, the increase in other current assets of $2,550 and the decrease in income tax payable of $1,312. Cash flow from operations and from the issue of common stock went to purchase new plant assets and to increase the cash balance. The stock options were important because it showed that the business is continuing to follow its policy of innovation and advancement by providing a future estimate for closures and additions of new lines.
    In investing activities, fixed assets are less than 2003 at $685,000. This shows the bulk of its fixed assets were bought in 2003 so the purchase level went down in 2004.
    In the financing, the only significant inflow of cash was from the issued shares of $4707.
    Excluding the investing activities, the cash flow of the financing and operation activities were positive. This gave a positive net cash flow of $5326 and increase to the business’ cash reserves.


    In 2003, the cash flow from operations was $11655. This is much higher than the net income of $6814. This is probably due to adjustments in loss from discontinued operations of $1013 and increase in liabilities like accrued payroll and income tax payable. Issue of common stock and cash flow from operations went to purchase new plant assets, repay borrowings and long-term debt and to...