Suppose the income statement for Goggle Company reports $115 of net income, afte
ID: 2467090 • Letter: S
Question
Suppose the income statement for Goggle Company reports $115 of net income, after deducting depreciation of $30. The company bought equipment costing $85 and obtained a long-term bank loan for $90.
Calculate the change in each balance sheet account and indicate whether each account relates to operating, investing, and/or financing activities (+ for increase and for decrease). (Put "NE" if there is no effect. Enter all amounts as positive values.)
1.Calculate the change in each balance sheet account and indicate whether each account relates to operating, investing, and/or financing activities (+ for increase and for decrease). (Put "NE" if there is no effect. Enter all amounts as positive values.)
Explanation / Answer
Change
type
1)Cash
235
operating
2) Account receivable
105
0perating
3)inventory
-145
0operating
4)Equipment
85
investing
5) Accumulated depreciation
-30
operating
6)Salaries & wages payable
45
operating
7)Notes payable
90
Financing
8)Common stock
-
Financing
9)Retained earnings
115
Operating
Change
type
1)Cash
235
operating
2) Account receivable
105
0perating
3)inventory
-145
0operating
4)Equipment
85
investing
5) Accumulated depreciation
-30
operating
6)Salaries & wages payable
45
operating
7)Notes payable
90
Financing
8)Common stock
-
Financing
9)Retained earnings
115
Operating
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