For each of the following situations, identify whether the activity is an operating, investing, or financing activity and compute the cash provided or used by the activity. The indirect method is used.

Transcribed Image Text:

Operating (O) Investing (I) Financing (F) Increase (+) Amount of Decrease (-) Activity Cash Flow a. A building with a cost of $188,000 and accumulated depreciation of $44,000 was sold for a $17,000 gain. b. Net income for last year was $117,000. The accumulated depreciation balance increased by $20,000. There were no changes in noncash current assets or liabilities. There were also no sales of plant assets. c. Net income was $23,000 for the year. Accounts receivable increased by $8,000, and accounts payable increased by $1,000. There were no other changes in the noncash current assets and current liabilities. There was no depreciation for the year. d. Bonds payable with a face value of $60,000 were retired with a cash payment for their face value. New bonds were issued later in the year for $37,000. e. Bonds payable were retired for their face value of $65,000 (cash paid). Cash dividends of $11,000 were also paid. A new long-term note payable was signed for cash proceeds of $25,000. f. A plant asset with a cost of $66,000 and accumulated depreciation of $15,000 was sold for a $12,000 loss. g. Current assets (not including cash) increased by $1,000, and current liabilities decreased by $10,000. There was no depreciation. Net income was $55,000 for the year. h. Common stock was issued for $260,000 cash. Dividends of $25,000 were paid in cash. i. Noncash current assets decreased by $6,000, and current liabilities decreased by $15,000. Depreciation was $14,000 for the net income was $53,000. while year,