[The following information applies to the questions displayed below.] The follow

Question

[The following information applies to the questions displayed below.]

The following events apply to Gulf Seafood for the 2018 fiscal year:

The company started when it acquired $60,000 cash by issuing common stock.

Purchased a new cooktop that cost $40,000 cash.

Earned $72,000 in cash revenue.

Paid $25,000 cash for salaries expense.

Adjusted the records to reflect the use of the cooktop. Purchased on January 1, 2018, the cooktop has an expected useful life of four years and an estimated salvage value of $4,000. Use straight-line depreciation. The adjusting entry was made as of December 31, 2018.

Required

Record the above transactions in a horizontal statements model like the following one. (In the Cash Flow column, indicate whether the item is an operating activity (OA), an investing activity (IA), a financing activity (FA) and net change in cash (NC). The letters NA indicate that an element is not affected by the event. Enter any decreases to account balances and cash outflows with a minus sign.)

Explanation / Answer

STATEMENT OF CASH FLOWS Detail Amount in $) Cash Flow from Operating activities:- Cash Revenue Earned $72,000 Less: Salaries Expense -$25,000 Deperication   ( NA) Net Cash Provided by Operating activities (A) $47,000 Cash flow from investing activities Purchased a New Cooktop -$40,000 Net Cash provided by Investing activities (B) -$40,000 Cash Generated from Finance   Activities Issue of Common Stock $60,000 Net Cash provided by Financiang Activities ( C ) $60,000 Net Cash Generated ( A+B+C) $67,000

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