FIN. ACCT.-TOOLS FOR BUS.DEC.MAKING-CODE
9th Edition
ISBN: 9781119595724
Author: Kimmel
Publisher: WILEY C
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E2-30. Apply Financial Statement Linkages to Understand Transactions
Consider the effects of the independent transactions, a through g, on a company's balance sheet, income
statement, and statement of cash flow. Complete the table below to explain the effects and financial
statement linkages. Use "+" to indicate the account increases and "-" to indicate the account decreases.
Refer to Exhibit 2-10 as a guide for the linkages.
Balance Sheet
Cash...
Noncash assets
Total liabilities...
Contributed capital.
Retained earnings
Other equity.
Statement of Cash Flows
Operating cash flow
Investing cash flow.
Financing cash flow
Income Statement
Revenues
Expenses
Net income.
Statement of Stockholders' Equity
Contributed capital.
Retained earnings
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a. Owners invested cash in the company in exchange for shares of common stock.
b. The company received cash from the bank for a loan.
c. The company purchased equipment to manufacture goods for sale and…
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Apply Financial Statement Linkages to Understand TransactionsConsider the effects of the independent transactions, a through g, on a company’s balance sheet, income statement, and statement of cash flow. Complete the table below to explain the effects and financial statement linkages. Use “+” to indicate the account increases and “−” to indicate the account decreases. Refer to Exhibit 2-10 as a guide for the linkages
a
b
c
d
e
f
g
Balance Sheet
Cash
Noncash assets
355030
Total liabilities
241272
Contributed capital
35867
Retained earnings
Other equity
Statement of Cash Flows
Operating cash flow
Investing cash flow
Financing cash flow
Income Statement
Revenues…
Activity #7A. Classification of Concepts. Classify each transaction whether they are operating, investing, or financing. After which, indicate the reasons for such classification. Finally indicate the effect of the transactions to cash flows.Transaction Activity Reason Effect 1. Payment to suppliers of goods Operating Affects profit and lossDecrease cash2. Payment to suppliers of services3. Receipts from goods sold4. Receipts from service rendered5. Payment to employees6. Purchase of equipment7. Purchase of fixtures8. Purchase of patents9. Purchase of copyrights10. Purchase of trademarks11. Payment of interest12. Proceeds from interests13. Payment to owners14. Receipts from owners15. Payment of income taxes16. Proceeds from long-term debt17. Payment of long term debt18. Proceeds from sale of vehicle19. Proceeds from sale of patent20. Proceeds from sale of copyrights21. Proceeds from sale of trademarks
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- Which of the following journal entries is correct when a business entity uses cash to pay an account payable? Multiple Choice Accounts Receivable xxx Cash xxx Accounts Payable xxx Cash xxx Cash xxx Accounts Payable xxx Cash xxx Notes Payable xxxarrow_forwardName a source document that provides information about each of the following types of business transactions: a. Cash payment b. Cash receipt c. Sale of goods or services d. Purchase of goods or servicesarrow_forwardIdentify whether each of the following transactions, which are related to revenue recognition, are accrual, deferral, or neither. A. sold goods to customers on credit B. collected cash from customer accounts C. sold goods to customers for cash D. collected cash in advance for goods to be delivered laterarrow_forward
- Explain how the accounting equation organizes financial information using T-accounts and debits and credits.arrow_forwardI’m confused on how to enter these into the table. Specifically b & c. My table options are -beginning balance -cash disbursements -cash receipts -cash receipts on account -payments on account -purchases on account - sales on account Thank you!arrow_forward0. The journal in which invoices for services provided are recorded is the revenue journal0. ____ 1. The ledger which contains all of the financial statement accounts is called th 1. ____ 2. Each transaction in the cash receipts journal will have an amountentered in the debit column entitled2. ____ 3. Each subsidiary ledger is represented by a summarized account in thegeneral ledger, called a(n)3. ____ 4. The accounts in the accounts payable ledger have a normal balance of(debit or credit)4. ____ 5. E-commerce performs transactions over the 5. ____ 6. The special journal designed for recording sales on account is the 7. The special journal designed for recording cash receipts is the 6. ____ 8. The subsidiary ledger containing information on the amounts due from individual customers is the 7. ____ 9. Entries to adjust depreciation expense at…arrow_forward
- Which of the following is not an example of a cash outflow? Select one: a. Purchase of inventory on credit b. pay employee wages and salaries c. cash withdrawal by the owner d. payment of income tax e. payment of accounts payablearrow_forwardGive typing answer with explanation and conclusion Which one of the following is a source of cash? issuance of debt payment to a supplier purchase of inventory granting credit to a customer repurchase of common stockarrow_forwardFrom the Statement of cash flows problem on pages 4-7 and 4-8...which of the following is not an operating cash flow? A. Receive cash from a customer B. Provided services on account C. Pay for rent D. Pay interest on loanarrow_forward
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