125. The following transactions to Kellogg Company. 1) Issued common stock for $20,000 cash 2) Provided services to customers for $38,000 on account 3) Purchased land for $15,000 cash 4) Incurred $29,000 of operating expenses on account 5) Collected $35,000 cash from customers for services provided in event #2 6) Paid $27,000 on accounts payable 7) Paid $2,000 dividends to stockholders Required: a) Identify the dollar amount effect on the Statement of Cash Flows, if any, for each of the above transactions. Precede a cash outflow amount with a minus sign. Enter NA for items not affected. b) Indicate whether each transaction involves operating, investing, or financing activities. Enter NA for items not affected. c) Classify the above accounting events into one of four types of transactions (asset source, asset use, asset exchange, claims exchange). Answer: Learning Objective: 02-01 Learning Objective: 02-02 Learning Objective: 02-09 Topic Area: Accounting for accounts receivable Topic Area: Accounting for accrued expense Topic Area: Transaction classification AACSB: Analytical Thinking AACSB: Knowledge Application AICPA: BB Critical Thinking AICPA: FN Measurement Blooms: Analyze Blooms: Level of Difficulty: 2 Medium
125. The following transactions to Kellogg Company. 1) Issued common stock for $20,000 cash 2) Provided services to customers for $38,000 on account 3) Purchased land for $15,000 cash 4) Incurred $29,000 of operating expenses on account 5) Collected $35,000 cash from customers for services provided in event #2 6) Paid $27,000 on accounts payable 7) Paid $2,000 dividends to stockholders Required: a) Identify the dollar amount effect on the Statement of Cash Flows, if any, for each of the above transactions. Precede a cash outflow amount with a minus sign. Enter NA for items not affected. b) Indicate whether each transaction involves operating, investing, or financing activities. Enter NA for items not affected. c) Classify the above accounting events into one of four types of transactions (asset source, asset use, asset exchange, claims exchange). Answer: Learning Objective: 02-01 Learning Objective: 02-02 Learning Objective: 02-09 Topic Area: Accounting for accounts receivable Topic Area: Accounting for accrued expense Topic Area: Transaction classification AACSB: Analytical Thinking AACSB: Knowledge Application AICPA: BB Critical Thinking AICPA: FN Measurement Blooms: Analyze Blooms: Level of Difficulty: 2 Medium
Test-Bank-Fundamental-Financial-Accounting-Concepts-9th-Edition-Edmonds.docx