The cash flow statement categorizes like transactions for optimal reporting.
Requirement
1. Identify each of the following transactions as one of the following:
● Operating activity (O)
● Investing activity (I)
● Financing activity (F)
● Noncash investing and financing activity (NIF)
● Transaction that is not reported on the statement of cash flows (N)
For each cash flow, indicate whether the item increases (+) or decreases (–) cash. The indirect method is used to report cash flows from operating activities.
______ a. Loss on sale of land.
______ b. Acquisition of equipment by issuance of note payable.
______ c. Payment of long-term debt.
______ d. Acquisition of building by issuance of common stock.
______ e. Increase in salary payable.
______ f. Decrease in inventory.
______ g. Increase in prepaid expenses.
______ h. Decrease in accrued liabilities
______ i. Cash sale of land.
______ j. Issuance of long-term note payable to borrow cash.
______ k. Depreciation.
______ l. Purchase of treasury stock.
______ m. Issuance of common stock.
______ n. Increase in accounts payable.
______ o. Net income.
______ p. Payment of cash dividend.