An ability to visualize quickly the effect of a transaction on the cash resources of a company is a useful analytical skill. This visualization requires an understanding of the economics underlying transactions and how they are accounted for. Expressing transactions in entry form can help one understand business activities.

Required:
A schematic statement of cash flows is reproduced below. The titles of lines in the schematic are given labels (letters). Several business activities are listed below the schematic. For each of the activities listed, identify the lines affected and by what amount. Each activity is separate and unrelated to another. The company closes its books once each year on December 31. Do not consider subsequent activities. Use the labels (letters) shown below. Do not indicate the effect on any line not given a label. If a transaction has no effect, write none. In indicating effects for lines labeled Y and C, use a to indicate an increase and a  to indicate a decrease. (Hint: Every activity with an effect affects at least two lines—equal debits and credits. An analytical entry can aid in arriving at a solution.