q9.3) For each? transaction, indicate the amount of the cash? flow, indicate whe

Question

q9.3) For each? transaction, indicate the amount of the cash? flow, indicate whether each results in an inflow or outflow of? cash, and give the section of the statement in which each cash flow would appear. Assume the statement of cash flows is prepared using the direct method.

Inflow or Outflow Section of the Transaction Statement a. Issued 1,000 shares of $3 par common stock for $10 per share b. Purchased $800 of supplies for $650 cash and the balance on account c. Borrowed $10,500 from a local bank to expand the business d. Purchased some office equipment for $4,500 cash e. Earned revenue of $20,000, receiving $7,900 cash and the balance on account f. Repaid $6,400 of the bank loan along with $950 interest g. Hired an office assistant and paid her $1,650 cash h. Declared and paid cash dividends of $950

Explanation / Answer

inflow Section of the statement Transaction amount outflow a) common stock 10000 inflow financing activities b) supplies 650 outflow operating activities c) borrowed 10,500 inflow investing d) office equipment 4,500 outflow investing e) Revenue 7,900 inflow operating activities f) repaid bank loan 6,400 outlfow investing 950 outflow operating g) salary 1,650 outflow operating h) Cash dividend 950 outflow financing

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