Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN: 9781305654174
Author: Gary A. Porter, Curtis L. Norton
Publisher: Cengage Learning
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Question
For each of the events listed below, select the category that best describes its effect on a statement of
- Cash provided/used by operating activities
- Cash provided/used by investing activities
- Cash provided/used by financing activities
- Not a cash flow item
Events:
_____ 1. Issuance of common shares
_____ 2. Purchase of land and building
_____ 3. Redemption of bonds
_____ 4. Proceeds on sale of equipment
_____ 5.
_____ 6. Amortization of patent
_____ 7. Issuance of bonds in exchange for land
_____ 8. Payment of cash dividends
_____ 9. Exchange of furniture for equipment
_____ 10. Loss on disposal of equipment
_____ 11. Increase in
_____ 12. Decrease in accounts payable during year
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- Use the following excerpts from Nutmeg Companys financial records to determine net cash flows from operating activities and net cash flows from investing activities.arrow_forwardClassification of Cash Flows A company's statement of cash flows and the accompanying schedule of investing and financing activities not affecting cash may contain the following major sections: a. Operating Activities b. Investing Activities c. Financing Activities d. Investing and Financing Activities not Affecting Cash The following is a list of items that might appear on a company's statement of cash flows or in the accompanying schedule. Required: Using the letters A through D, indicate in which section of the statement of cash flows (or the accompanying schedule) the preceding item would most likely be classified. After each letter, indicate with a plus (+) or a minus () whether the item would be reported on the statement (or the accompanying schedule).arrow_forwardNeed for a Statement of Cash Flows. The accrual basis of accounting creates the need for a statement of cash flows. Explain.arrow_forward
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