Below are line items included in recent statements of cash flows prepared by a national retailer. For some items, the direction of the change in the account is also indicated.
1. Accounts payable, increase.
2. Accounts receivable, decrease.
3. Accrued expenses payable, decrease.
4. Capital expenditures.
5. Deferred income tax liability (long term), increase.
6. Depreciation and amortization expense.
7. Dividend payouts.
8. Income taxes payable decrease.
9. Issuance of common stock.
10. Issuance of long-term debt.
11. Issuance of short-term debt.
12. Merchandise inventories, decrease.
13. Other current assets, increase.
14. Proceeds from disposals of property and equipment.
15. Purchase common stock in other companies.
16. Purchase of treasury stock.
17. Repayment of long-term debt.
For each item, indicate in which section of the statement of cash flows it would appear, assuming the operating portion was prepared using the indirect method.
1. Operating activities
2. Financing activities
3. Investing activities
4. Would not appear in the statement
For those flows you identified as operating, indicate whether the amount would have been added to or subtracted from net income in the operating portion of the statement of cash flows knowing it was prepared using the indirect method.