The following information was drawn from the year-end balance sheets of Long's Wholesale, Inc.:
Account Title 2017 2016
Bonds payable............... $400,000............... $600,000
Common stock.................190,000................. 150,000
Treasury stock.................. 20,000.................. 15,000
Retained earnings............... 96,000................. 80,000
Additional information regarding transactions occurring during 2017:
1. Long's Wholesale, Inc. issued $90,000 of bonds during 2017. The bonds were issued at face value. All bonds retired were retired at face value.
2. Common stock did not have a par value.
3. Long's Wholesale, Inc. uses the cost method to account for treasury stock. Long's Wholesale, Inc. did not resell any treasury stock in 2017.
4. The amount of net income shown on the 2017 income statement was $49,000.
Required
a. Determine the amount of cash flow for the retirement of bonds that should appear on the 2017 statement of cash flows.
b. Determine the amount of cash flow from the issue of common stock that should appear on the 2017 statement of cash flows.
c. Determine the amount of cash flow for the purchase of treasury stock that should appear on the 2017 statement of cash flows.
d. Determine the amount of cash flow for the payment of dividends that should appear on the 2017 statement of cash flows.
e. Prepare the financing activities section of the 2017 statement of cash flows.