10. The 2008 balance sheet of The Beach Shoppe showed long-term debt of $2.1 million, and the 2009 balance sheet showed long-term debt of $2.3 million. The 2009 income statement showed an interest expense of $250,000. What was the cash flow to creditors for 2009?
To find the cash flow to creditors for 2009, we need to calculate the change in long-term debt and add the interest expense.
Change in Long-term Debt = 2009 Long-term Debt - 2008 Long-term Debt
Change in Long-term Debt = $2.3 million - $2.1 million
Change in Long-term Debt = $0.2 million
Cash Flow to Creditors = Change in Long-term Debt + Interest Expense
Cash Flow to Creditors = $0.2 million + $250,000
Cash Flow to Creditors = $450,000
Therefore, the cash flow to creditors for 2009 was $450,000.