s The following information is available for Intermediate Co. for the year ended
ID: 2554064 • Letter: S
Question
s The following information is available for Intermediate Co. for the year ended 2018. a) Label each of the Financing activities Net income was $56,45o. operating adbvitios Equipment (cost $21,190 and $9,190) was sold for $11,190 Depreciation expense was $5,190 on the building and $10,190 on Paent aotowas $2.500 Invasting activithes Current assets other than cash increased by s ) An addition to the building was at a cost of $28,190. vesting achhvi a. A long-term investment (Equity) in stock was purchased for $16,000. Financ h) Bonds payable of $3230 wer ised inanc Cash dividends of $30,000 were declared and paid. Financi Treasury stock was purchased ata ost of SI,000 inancing acbvibi eExplanation / Answer
NO Description Activity reason a Net income was 56450 operating Net income is useful in reconciliation of operating activites b) sale of equipment investing it is a cash inflow form investing activity c) Depreciation expense operating deprecaition is added back, since there is no cash outflow or inflow from it d) patent amortization operating amortization is added back, since there is no cash outflow from it e) increase in current assets and liabilities operating current assets and liabilities are operating activities f) Additions to building Investing it is an investing activity g) long term investment investing It is a long term investment in shares, hence considered as investing h) Bonds payable Financing Since it is borrowing of cash by issuing bond, hence finance activity i Cash dividends Financing cash dividends are financing activities j) treasury stock Financing purchase of own stock is a financing activity
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.