1. The office manager just submitted hisresignation and the search for a replace
ID: 2502242 • Letter: 1
Question
1. The office manager just submitted hisresignation and the search for a replacement must be organized.
2. A loan officer from the company’sbank just phoned saying that the company’s application for a$400,000 loan has been approved.
3. Bids from several vendors have beenreceived regarding installation of a new computerized informationsystem. One proposal must be selected.
4. Because the new bank loan has beenapproved, two short-term loans can be paid off.
5. Old office furniture is awaitingdisposal.
6. A long-time customer is unhappy with thefirm’s latest architectural drawings for a new shoppingcenter complex.
7. A new construction crane is beingpurchased.
8. An investor has approached Leonettaoffering to purchase 20% of her company in exchange for cash.
9. The firm is considering the purchase ofexclusive regional rights t a patented construction process.
10. One of the company’s customers is behind onscheduled payments. The amounts are large and Leonetta must decidewhether to suspend construction on the project involved.
Identify each of the issues above as involving a financingactivity, an investing activity, or an operating activity.
Explanation / Answer
1 Non- Financing activity Non - Investing Activity Non - Operating Activity 2 Financing Activity 3 Non- Financing activity Non - Investing Activity Non - Operating Activity 4 Operating Activity assuming that the loans are paid off 5 Non- Financing activity Non - Investing Activity Non - Operating Activity 6 Non- Financing activity Non - Investing Activity Non - Operating Activity 7 Investment activity 8 Financing Activity 9 Non- Financing activity Non - Investing Activity Non - Operating Activity 10 Non- Financing activity Non - Investing Activity Non - Operating Activity
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