Question

Tabares Corporation had these transactions during 2020.

Indicate whether each transaction is an operating activity, investing activity, financing activity, or noncash investing and financing activity.
(a) Issued $50,000 par value common stock for cash.
Operating ActivitiesNoncash Investing and/or Financing ActivitiesFinancing ActivitiesInvesting Activities
(b) Purchased a machine for $30,000, giving a long-term note in exchange.
Investing ActivitiesFinancing ActivitiesNoncash Investing and/or Financing ActivitiesOperating Activities
(c) Issued $200,000 par value common stock upon conversion of bonds having a face value of $200,000.
Noncash Investing and/or Financing ActivitiesOperating ActivitiesInvesting ActivitiesFinancing Activities
(d) Declared and paid a cash dividend of $18,000.
Financing ActivitiesInvesting ActivitiesOperating ActivitiesNoncash Investing and/or Financing Activities
(e) Sold a long-term investment with a cost of $15,000 for $15,000 cash.
Noncash Investing and/or Financing ActivitiesOperating ActivitiesFinancing ActivitiesInvesting Activities
(f) Collected $16,000 from sale of goods.
Financing ActivitiesInvesting ActivitiesNoncash Investing and/or Financing ActivitiesOperating Activities
(g) Paid $18,000 to suppliers.
Noncash Investing and/or Financing ActivitiesFinancing ActivitiesOperating ActivitiesInvesting Activities

Answer 1

b) Noncash Activities

Step-by-step explanation:

Direct issuance of debts to purchase assets.

Purchased a machine for $30,000, giving a long-term note in exchange.

Answer 2

Tabares Corporation

Indication of whether each transaction is an operating activity, investing activity, financial activity, or noncash investing and financing activity:

a) Financing activity

b) Investing activity

c) Noncash financing activity

d) Financing activity

e) Investing activity

f) Operating activity

g) Operating activity

Step-by-step explanation:

A statement of cash flows is a financial statement that shows the inflow and outflow of cash for a period. It is divided into 3 main activities and noncash investing and financing activity.

The activities are Operating, Financing, and Investing. The Operating Activity section shows the inflow and outflow of cash from normal business operations.

The Financing Activity section shows the inflow and outflow of cash from financing (raising funds and repayment of funds) the business.

The Investing Activity section shows the inflow and outflow of cash as a result of the investments made by the entity, including the purchase of noncurrent assets and security investments, and their disposal.