Reporting Stockholders\' Equity Items on Statement of Cash Flows On the basis of

Question

Reporting Stockholders' Equity Items on Statement of Cash Flows

On the basis of the following stockholders' equity accounts, indicate the items, exclusive of net income, to be reported on the statement of cash flows. There were no unpaid dividends at either the beginning or the end of the year.

If an amount is not reported on the statement of cash flows, enter in "0" in the Amount column.

ACCOUNT Common Stock, $15 par ACCOUNT NO. Balance Date Item Debit Credit Debit Credit 2014 Jan. 1 Balance, 60,000 shares 900,000 Mar. 7 15,000 shares issued for cash 225,000 1,125,000 June 30 2,000-share stock dividend 30,000 1,155,000

Explanation / Answer

Answer:

Item Section of Statement of Cash Flows Added or Deducted Amount $ Reason 1. Sale of common stock Financing activities section Added          645,000 Increases the cash and it is for raising the capital. 2 Cash dividend Financing activities section Deducted            85,900 Decrease the cash and it is compensation for the capital providers 3 Stock dividend None Not applicable 0 It is not part of cash flow as it does not impact cash.

Related Questions

Navigate

• Browse (All)
• Browse R
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.