record each transaction on a chart like the following classify the sections of the s 621867
Classifying transactions and their cash effects
Several transactions entered into by Travis Retail during 2012 follow:
- Received $50,000 for wine previously sold on account.
- Paid $55,000 in wages.
- Sold a building for $100,000. The building had cost $170,000, and the related accumulated depreciation at the time of sale was $55,000.
- Declared and paid a cash dividend of $70,000.
- Repurchased 10,000 shares of outstanding common stock at $50 per share.
- Purchased a two-year, $100,000 fire and storm insurance policy on June 30.
- Purchased some equipment in exchange for 1,000 shares of common stock. The stock was currently selling for $75 per share.
- Purchased $500,000 in equity securities considered to be long-term.
- Issued $200,000 face value bonds. The bonds were sold at 101. 10. Owed $30,000 in rent as of December 31.
REQUIRED:
Record each transaction on a chart like the following. Classify the sections of the statement of cash flows as a cash flow from operating, investing, or financing activities. Transaction (1) is done as an example.
Transactions |
Effect on cash |
Section of statement |
Explanation |
1 |
50,000 |
Operating |
Operations is defined in terms of inventory activity |