E12-1 Matching Items Reported to Cash Flow Statement Categories (Indirect Method

Question

E12-1 Matching Items Reported to Cash Flow Statement Categories (Indirect Method) [LO 12-1, LO 12-2] NIKE, Inc. is the best-known sports shoe, apparel, and equipment company in the world because of its association with sports stars such as LeBron James and Serena Williams. Some of the items included in its recent statement of cash flows presented using the indirect method are listed here. Select whether each item is disclosed in the operating activities, investing activities, or financing activities section of the statement or use (NA) if the item does not appear on the statement. 1. Additions to long-term debt 2. Depreciation. 3. Additions to equipment. 4· Increase (decrease) in notes payable. (The amount is owed to financial institutions.) 5. (ncrease) decrease in other current assets. 6. Cash received from disposal of equipment. 7. Reductions in long-term debt. 8. Issuance of stock 9. (Increase) decrease in inventory. 10. |Net income

Explanation / Answer

Additions to long term debt Financing activity Depreciation Operating activity Additions to equipment Investing activity Increase(decrease) in notes payable Financing activity (Increase) decrease in other current assets Operating activity Cash received from disposal of equipment Investing activity Reduction in long term debt Financing activity Issuance of stock Financing activity (Increase) decrease in inventory Operating activity Net income Operating activity

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