Question

Neo Watch Company produces pocket watches and has had the following transactions:
1. Retired long-term bonds.
2. Sold a warehouse for $600,000.
3. Issued a long-term note payable for $350,000.
4. Purchased a new robotic system to automate manufacturing operations.
5. Purchased a 40 percent interest in Hazel Works, an electronics manufacturer.
6. Reported a loss on the sale of old equipment of $6,000.The equipment was sold for $3,000 in cash.
7. Obtained a long-term bank loan.
8. Paid cash dividends of $200,000.

Required
For purposes of the statement of cash flow, classify each of these transactions as an operating, investing, or financing activity. Additionally, indicate whether the activity is a source of cash or a use of cash.



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  • CreatedSeptember 23, 2013
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