A company had the following transactions during its most recent fiscal period: 1. Paid rent of $39,000
Question:
1. Paid rent of $39,000 during the year which included $3,000 for the first month of next year.
2. Paid $11,700 of income taxes owed from the previous period.
3. Borrowed $50,000 from the bank, to be repaid in two years.
4. Bought inventory from suppliers on credit for $315,000.
5. Paid $290,000 cash on accounts payable.
6. Issued additional shares for $120,000 cash.
7. Paid wages of $27,000 to employees.
8. Recorded $500 of wages owed to employees at the end of the period.
9. Purchased a new machine for $18,000 cash.
10. Sold an old machine having a book value (cost minus accumulated depreciation) of $3,000 for $4,000 cash.
11. Recorded depreciation expense of $2,400 on machinery.
12. Sold inventory to customers on credit for $510,000. The inventory had a cost of $305,000.
13. Paid $2,000 for advertising.
14. Bought office supplies for $5,000 cash, $3,500 of the supplies were used during the period.
15. Paid $3,600 interest on the amount borrowed.
16. Collected $480,000 on accounts receivable.
17. Declared and paid dividends of $6,300.
Required:
a. For each of the transactions listed above, use the following format to indicate the transaction's effect on the statement of financial position categories:
b. For each transaction that affects cash, state whether it relates to an operating, investing, or financing activity.
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Related Book For
Financial Accounting A User Perspective
ISBN: 978-0470676608
6th Canadian Edition
Authors: Robert E Hoskin, Maureen R Fizzell, Donald C Cherry
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