Problem 2 Listed below are several transactions. For each transaction, indicate
ID: 2496892 • Letter: P
Question
Problem 2
Listed below are several transactions. For each transaction, indicate by letter whether the cash effect of each transaction is reported in a statement of cash flows as an operating (O), investing (I), financing (F), or noncash (NC) activity. Also, indicate whether the transaction is a cash inflow (CI), cash outflow (CO), or no effect on cash (NE). The first answer is provided as an example.
Type of Activity
Cash Inflow or Outflow
Transaction
F
CI
1. Issuance of common stock
2. Issuance of bonds
3. Investment in bonds
4. Collection of a note receivable
5. Sale of inventory
6. Repayment of note payable
7. Payment of a cash dividend
8. Purchase of land for cash
9. Reissue of treasury stock
10. Collection of an account receivable
11. Issuance of a note payable
12. Payment of employee salaries
13. Sale of equipment for a note receivable
14. Payment of interest on bonds payable
15. Sale of a building
Type of Activity
Cash Inflow or Outflow
Transaction
F
CI
1. Issuance of common stock
2. Issuance of bonds
3. Investment in bonds
4. Collection of a note receivable
5. Sale of inventory
6. Repayment of note payable
7. Payment of a cash dividend
8. Purchase of land for cash
9. Reissue of treasury stock
10. Collection of an account receivable
11. Issuance of a note payable
12. Payment of employee salaries
13. Sale of equipment for a note receivable
14. Payment of interest on bonds payable
15. Sale of a building
Explanation / Answer
Type of activity Cash inflow or outflow Transactions F CI Issuance ofCommon Stock F CI Issuanceof Bonds I CO Investment in Bond O CI Collection ofnote receivable O CI Sale of inventory O CO Repayment of Note payable F CO Payment of cash dividend I CO Purchase of land for cash F CO Reissue of Treasuary Stock O CI Collection from accounts receivable O CI Issuance of Note payable O CO Payment of employees salary NC NE Sale of equipment for a note payable O Co Paymentof interest on bond payable F CI Sale of building
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