Omega Company's accountants have just completed the income statement and balance sheet for the year and have provided the following information (dollars in thousands): INCOME STATEMENT Sales revenue $ 20,760 Expenses Cost of goods sold $ 9,160 Depreciation expense 2,960 Salaries expense 4,120 Rent expense 2,840 Insurance expense 930 Utilities expense 870 Interest expense on bonds 950 Loss on sale of investments 730 22,560 Net loss $ (1,800 ) SELECTED BALANCE SHEET ACCOUNTS Prior Year Current Year Merchandise inventory $ 75 $ 91 Accounts receivable 537 447 Accounts payable 215 262 Salaries payable 17 39 Rent payable 20 10 Prepaid rent 7 4 Prepaid insurance 14 19 Other Data: The company issued $19,000, 10 percent bonds payable at par during the year. Required: 1. Prepare the cash flows from operating activities section of the statement of cash flows using the direct method. (List cash outflows as negative amounts. Enter your answers in thousands.)

In each of the cases below, assume division x has a product that can be sold either to outside customers or to division y of the same company for use in its production process. the managers of the divisions are evaluated based on their divisional profits. case a b division x: capacity in units 200,000 200,000 number of units being sold to outside customers 200,000 160,000 selling price per unit to outside customers $ 90 $ 75 variable costs per unit $ 70 $ 60 fixed costs per unit (based on capacity) $ 13 $ 8 division y: number of units needed for production 40,000 40,000 purchase price per unit now being paid to an outside supplier $ 86 $ 74 required: 1. refer to the data in case a above. assume in this case that $3 per unit in variable selling costs can be avoided on intracompany sales. a. what is the lowest acceptable transfer price from the perspective of the selling division? b. what is the highest acceptable transfer price from the perspective of the buying division? c. what is the range of acceptable transfer prices (if any) between the two divisions? if the managers are free to negotiate and make decisions on their own, will a transfer probably take place?