Q1. On the statement of cash flows, a positive amount indicates a cash (__________ / outflow), whereas

Question:

Q1. On the statement of cash flows, a positive amount indicates a cash (__________ / outflow), whereas a negative amount indicates a cash (inflow / __________).
Q2. Identify the following transactions as Operating, Investing, or Financing activities.
(_____/ I / F) a. Receive cash from customers
(O / _____/ F) b. Purchase property, plant, and equipment
(_____/ I / F) c. Pay employee wages
(O / I / ____) d. Issue I / F) e. Pay suppliers
(O / I / ___) f. Pay back long-term debt
Q3. Refer to the cash flow information displayed below to answer the following questions.
a. For Southwest Airlines, the primary source of cash is (__________/ investing / financing) activities, which is considered (__________/ unfavorable / depends).
For an established company, the expected primary source of cash is (__________/ investing / financing) activities. Southwest Airlines is a(n) (young / __________) company.
b. The purchase and sale of long-term assets are reported as (operating / __________/ financing) activities, which for this company is a cash (inflow / __________). This company is (__________/ selling) long-term assets, which is considered (__________/ unfavorable / depends).
c. Borrowing funds, issuing stock, and paying dividends are reported as (operating / investing / __________) activities.
During 2009, borrowing and repaying debt are the primary financing activities. During 2009, financing activities report a net cash (__________/ outflow), indicating this company (__________/ paid off) more long-term debt.
During 2011, issuing and repurchasing are the primary financing activities. During 2011, financing activities report a net cash (inflow / __________), indicating this company (issued / __________) more common stock.
d. For operating activities, a net cash (__________/ outflow / depends) is preferred. Why?
For investing activities, a net cash (inflow / __________/ depends) is preferred. Why?
Purchasing PPE and other income-producing assets indicates the organization is growing and expanding.
For financing activities, a net cash (inflow / outflow / __________) is preferred. Why?
Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...