Rainey Enterprises loaned $40,000 to Small Company on June 1, Year 1, for one year at 6 percent interest.Required:Show the effects of the following transactions in a horizontal statements model.Note: Enter any decreases to account balances and cash outflows with a minus sign. For changes on the Statement of CashFlows, indicate whether the item is an operating activity (OA), investing activity (IA), or financing activity (FA). Not all cells requireinput. Do not round intermediate calculations. Round your final answers to the nearest whole dollar.(1) The loan to Small Company(2) The adjustment at December 31, Year 1.(3) The adjustment and collection of the note on June 1, Year 2.RAINEY ENTERPRISESHorizontal Statements ModelBalance SheetDateAssetsCash+NotesReceivable+InterestReceivable++1. 6/1/Year 12. 12/31/Year 13. 6/1/Year 2 Adjustment3. 6/1/Year 2 Note Collection++++++Liabilities+Stockholders'EquityRetainedEarningsIncome StatementStatement of CashFlowsRevenueExpenseNet Income++=++

Effect of Transactions in the Horizontal Statement Model: The effect of transactions in horizontal…

Answered: Rainey Enterprises loaned $40,000 to…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter16: Statement Of Cash Flows

Section: Chapter Questions

Problem 1PA: Provide journal entries to record each of the following transactions. For each, also identify *the...

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Provide journal entries to record each of the following transactions. For each, identify whether the transaction represents a source of cash (S), a use of cash (U), or neither (N). A. Paid $22,000 cash on bonds payable. B. Collected $12,600 cash for a note receivable. C. Declared a dividend to shareholders for $16,000, to be paid in the future. D. Paid $26,500 to suppliers for purchases on account. E. Purchased treasury stock for $18,000 cash.
During the year, Hepworth Company earned a net income of 61,725. Beginning and ending balances for the year for selected accounts are as follows: There were no financing or investing activities for the year. The above balances reflect all of the adjustments needed to adjust net income to operating cash flows. Required: 1. Prepare a schedule of operating cash flows using the indirect method. 2. Suppose that all the data are used in Requirement 1 except that the ending accounts payable and cash balances are not known. Assume also that you know that the operating cash flow for the year was 20,475. What is the ending balance of accounts payable? 3. CONCEPTUAL CONNECTION Hepworth has an opportunity to buy some equipment that will significantly increase productivity. The equipment costs 25,000. Assuming exactly the same data used for Requirement 1, can Hepworth buy the equipment using this years operating cash flows? If not, what would you suggest be done?
Jarem Company showed 189,000 in prepaid rent on December 31, 20X1. On December 31, 20X2, the balance in the prepaid rent account was 226,800. Rent expense for 20X2 was 472,500. Required: 1. What amount of cash was paid for rent in 20X2? 2. CONCEPTUAL CONNECTION What adjustment in prepaid expenses is needed if the indirect method is used to prepare Jarems statement of cash flows?
Rainey Enterprises loaned $45,000 to Small Company on June 1, Year 1, for one year at 7 percent interest. Required Show the effects of the following transactions in a horizontal statements model. In the Statement of Cash Flows column, indicate whether the item is an operating activity (OA), an investing activity (IA), or a financing activity (FA). Note: Enter any decreases to account balances and cash outflows with a minus sign. Leave cells blank if no input is needed. (1) The loan to Small Company (2) The adjusting entry at December 31, Year 1. (3) The adjusting entry and collection of the note on June 1, Year 2.
Rainey Enterprises loaned $50,000 to Small Co. on June 1, Year 1, for one year at 6 percent interest. Required Show the effects of the following transactions in a horizontal statements. In the Cash Flow column, indicate whether the item is an operating activity (OA), an investing activity (IA), or a financing activity (FA). For any element not affected by the event, leave the cell blank. (Not every cell will require entry. Do not round intermediate calculations. Enter any decreases to account balances and cash outflows with a minus sign. Round your answers to the nearest whole dollar.) (1) The loan to Small Co. (2) The adjusting entry at December 31, Year 1. (3) The adjusting entry and collection of the note on June 1, Year 2. RAINEY ENTERPRISES Horizontal Statements Model Assets Equity Income Statement Date Statement of Cash Flow Liabilities Notes Receivable Interest Retained Earnings Cash Receivable Revenue Expense Net Income 1.6/1/Y1 2. 1201/Y1 a. 6/1/Y2 (Adjusting entry) 6/1/Y2…
Rainey Enterprises loaned $30,000 to Small Co. on June 1, Year 1, for one year at 7 percent interest. Required Show the effects of the following transactions in a horizontal statements model. (Enter any decreases to account balances and cash outflows with a minus sign. For changes on the Statement of Cash Flows, indicate whether the item is an operating activity (OA), investing activity (IA), or financing activity (FA). Not all cells require input. Do not round intermediate calculations. Round your final answers to the nearest whole dollar.) (1) The loan to Small Co. (2) The adjustment at December 31, Year 1. (3) The adjustment and collection of the note on June 1, Year 2. RAINEY ENTERPRISES Horizontal Statements Model Balance Sheet Stockholders" Equity Retained Assets Liabilities Date Notes Receivable Interest Receivable Cash Rever Earnings 1. 6/1/Year 1 2. 12/31/Year 1 3. 6/1/Year 2 Adjustment ++ ++ ++
Zirkle Company borrowed $146,000 from Plains Bank on July 31, Year 1. The note carried a 6% interest rate with a one-year term t maturity. Required: a. Show the effects of borrowing the money and the December 31, Year 1 adjustment on the accounting equation. b. What is the amount of interest expense for Year 1? c. Prepare a statement of cash flows for the Zirkle Company for Year 1. Complete this question by entering your answers in the tabs below. Required A Required B Required C Prepare a statement of cash flows for the Zirkle Company for Year 1. Note: Cash outflows should be indicated with a minus sign. ZIRKLE COMPANY Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flows from operating activities Net cash flow from operating activities Cash flows from investing activities Net cash flow from investing activities Cash flows from financing activities Ending cash balance Net cash flow from financing activities
Rainey Enterprises loaned $20,000 to Small Company on June 1, Year 1, for one year at 6 percent interest. Required Show the effects of the following transactions in a horizontal statements model. In the Statement of Cash Flows column, indicate whether the item is an operating activity (OA), an investing activity (IA), or a financing activity (FA). For any element not affected by the event, leave the cell blank. Note: Enter any decreases to account balances and cash outflows with a minus sign. Leave cells blank if no input is needed. (1) The loan to Small Company (2) The adjusting entry at December 31, Year 1. (3) The adjusting entry and collection of the note on June 1, Year 2. 3. Date 1. 6/1/Y1 2. 12/31/Y1 3. 6/1/72 (Adjusting entry) 6/1/Y2 (Collection of the note) Cash + + + + Assets Notes Receivable + + + + + RAINEY ENTERPRISES Horizontal Statements Model Balance Sheet Interest Receivable = Liabilities + + + + + Stockholders' Equity Retained Earnings Income Statement Revenue -…
Zirkle Company borrowed $129,000 from Plains Bank on July 31, Year 1. The note carried a 6% interest rate with a one-year term to maturity. Required: a. Show the effects of borrowing the money and the December 31, Year 1 adjustment on the accounting equation. b. What is the amount of interest expense for Year 1? c. Prepare a statement of cash flows for the Zirkle Company for Year 1. Complete this question by entering your answers in the tabs below. Required A Required B Required C Prepare a statement of cash flows for the Zirkle Company for Year 1. Note: Cash outflows should be indicated with a minus sign. ZIRKLE COMPANY Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flows from operating activities Net cash flow from operating activities Cash flows from investing activities Net cash flow from investing activities Cash flows from financing activities Net cash flow from financing activities < Required B Required C
Duning the year, Next Tec Corp. had the following cash flows receipt trom customers, $21,000, receipt from the bank for long term borrowing. $6,200, payment to supplers, $5,200, payment of dividends, $1700, payment to workers, $3.000, and payment for machenery $9,000. What amount would be reported for net financing cash flows in the statement of cash fows? Mutiple Choice S4500 $6 200 (19,000 SA000 20 s0 ype here to search Ps 40% S/1/20 K N Alt Ctri Home oOOo
Refer to the 10-K for Abercrombie & Fitch. Required: 1. What does the company report for the following accounts for the most current fiscal year: Enter your answer in thousands. a. Cash b. Short-term investments (or marketable securities) c. Accounts receivable d. Inventory e. Other current assets f. Accounts payable g. Other current liabilities h. Cash flow from operations A A AA A A 好 2. The company projects the following to occur in the next fiscal year: • Accounts payable will decrease by 25%. • Other current liabilities are expected to increase by 33%. • Cash flow from operations is expected to decrease by 32%. Assume all other items remain unchanged from the prior year. Provide the next year's forecasted balances for the following accounts and cash flow from operations.
Clark Bell started a personal financial planning business when he accepted $69,000 cash as advance payment for managing the financial assets of a large estate. Bell agreed to manage the estate for a one-year period beginning June 1, Year 1. Required Show the effects of the advance payment and revenue recognition on the Year 1 financial statements using the following horizontal statements model. In the Cash Flows column, use OA to designate operating activity, IA for investing activity, FA for financing activity, and NC for net change in cash. If the account is not affected, leave the cell blank. How much revenue would Bell recognize on the Year 2 income statement? What is the amount of cash flow from operating activities in Year 2?

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