Question: As of January 1 2016 Room Designs Inc had a

As of January 1, 2016, Room Designs Inc. had a balance of $9,900 in Cash, $3,500 in Common
Stock and $6,400 in Retained Earnings. These were the only accounts with balances in the ledger on January 1, 2016. Further analysis of the company’s cash account indicated that during the 2016 accounting period, the company had (1) net cash inflow from operating activities of $9,800, (2) net cash outflow for investing activities of $16,500, and (3) net cash inflow from financing activities of $11,000. All revenue and expense events were cash events. The following accounts and balances represent the general ledger of Room Designs Inc. as of December 31, 2016, before closing.
a. Assume that the net cash inflow from financing activities of $11,000 was caused by three events. Based on the information above, identify these events and determine the cash flow associated with each event.
b. What did the company purchase that resulted in the cash outflow from investing activities?
c. Prepare an income statement, statement of changes in stockholders’ equity, balance sheet, and statement of cash flows.

View Solution:

Sale on SolutionInn
  • CreatedApril 20, 2015
  • Files Included
Post your question