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Classification of Events on Statement of Cash FlowS

Classification of Events on Statement of Cash FlowS

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Classification of Events on Statement of Cash Flows The following transactions pertain to the operations of Party Consultants, an events planning entity owned by Geneveve Jacaban. The entity had the following transactions during the month: 1. Received a P180,000 cash investment from the owner. 2. Provided P400,000 services on account. 3. Incurred P220,000 of operating expenses on account. 4. Collected P320,000 cash from accounts receivable. 5. Allowed a P30,000 cash withdrawal to the owner of the business. 6. Paid P160,000 cash on accounts payable. 7. Performed services for P30,000 cash. 8. Paid P12,000 cash for expenses. Required: 1. Classify each of these transactions as a cash flow from operating activities (OA), investing activities (IA), or financing activities (FA). Transactions that do not affect the statement of cash flows should be identified as "n/a". 2. Prepare a statement of cash flows.
Transcribed Image Text:Classification of Events on Statement of Cash Flows The following transactions pertain to the operations of Party Consultants, an events planning entity owned by Geneveve Jacaban. The entity had the following transactions during the month: 1. Received a P180,000 cash investment from the owner. 2. Provided P400,000 services on account. 3. Incurred P220,000 of operating expenses on account. 4. Collected P320,000 cash from accounts receivable. 5. Allowed a P30,000 cash withdrawal to the owner of the business. 6. Paid P160,000 cash on accounts payable. 7. Performed services for P30,000 cash. 8. Paid P12,000 cash for expenses. Required: 1. Classify each of these transactions as a cash flow from operating activities (OA), investing activities (IA), or financing activities (FA). Transactions that do not affect the statement of cash flows should be identified as "n/a". 2. Prepare a statement of cash flows.
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