Question

Each of these items must be considered in preparing a statement of cash flows for Irvin Co. for the year ended December 31, 2017. For each item, state how it should be shown in the statement of cash flows for 2017. (a) Issued bonds for $200,000 cash. Choose the type of cash inflows and outflows (b) Purchased equipment for $180,000 cash. Choose the type of cash inflows and outflows (c) Sold land costing $20,000 for $20,000 cash. Choose the type of cash inflows and outflows (d) Declared and paid a $50,000 cash dividend. Choose the type of cash inflows and outflows

Answer 1

(a) Issued bonds for $200,000 cash. - cash inflow from financing activity;

(b) Purchased equipment for $180,000 cash. - cash outflow from investing activity;

(c) Sold land costing $20,000 for $20,000 cash. - cash inflow from investing activity;

(d) Declared and paid a $50,000 cash dividend. - cash outflow from financing activity