For each of the transactions in E1-34B, tell whether the transaction was an operating, investing, or financing activity.
In E1-34B, 1. Izzy started the business by contributing $5,500 in exchange for common stock, and the firm borrowed $3,500 from the bank.
2. Izzy’s Ice Cream Shop purchased an ice cream delivery truck for $4,500 cash.
3. The business purchased $1,200 worth of ice cream and other items (its inventory) for cash.
4. Izzy hired a delivery driver to work two days a week for a total of eight days the first month to help deliver ice cream for the new company. For this service, Izzy’s paid $25 each day worked.
5. The ice cream delivery service was popular and Izzy’s sold two-thirds of its inventory for total cash revenues of $3,600.
6. Izzy’s paid operating expenses of $215 the first month.
7. Izzy’s repaid $100 of the bank loan along with $5 of interest for the first month.

  • CreatedSeptember 01, 2014
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