ABC Company ended Year 1 with the following account balances:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:ABC Company ended Year 1 with the following account balances:
Cash 600, Common Stock 400, and Retained Earnings 200.
The following transactions occurred during Year 2:
• Issued common stock for $19,000 cash.
• ABC borrowed an additional $11,000 from Chris Bank.
• ABC earned $9,000 of revenue on account.
• ABC incurred $4,000 of operating expenses on account.
• Cash collections of accounts receivables were $6,000.
• ABC provided additional services to customers for $1,000 cash.
• ABC purchased land for $14,000.
• ABC used $3,000 in cash to make a partial payment on its accounts payable.
• ABC declared and paid a $200 dividend to the stockholders
• On December 31 ABC had accrued salaries of $4,000.
What is the net cash flow from operating activities shown on the statement of cash flows for the year ending December 31, Year 2?
Multiple Choice
O
O
$4,000
$3,800
$6,000
None of these answer choices is correct.
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