You are provided with the following transactions that took place during a recent fiscal year:

Instructions
Assuming the company is reporting under IFRS, complete the above table for each of the following requirements, assuming none of the transactions were previously accrued. The first one has been done for you as an example.

(a) Classify each transaction as an operating activity (O), an investing activity (I), a financing activity (F), or a non-cash transaction (NC) on the cash flow statement. If there is choice on how a transaction is classified, indicate the alternative classifications.
(b) Specify whether the transaction will increase (+), decrease (−), or have no eff ect (NE) on cash reported on the balance sheet.
(c) Specify whether the transaction will increase (+), decrease (−), or have no eff ect (NE) on profit reported on the income statement.

TAKING IT FURTHER Explain how an operating activity can decrease cash but not decrease profit.