[The following information applies to the questions displayed below] Maben Company was started on January 1, Year 1, and experienced the following events during its first year of operation: 1. Acquired $35,000 cash from the issue of common stock. 2. Borrowed $35,000 cash from National Bank. 3. Earned cash revenues of $53,000 for performing services. 4. Paid cash expenses of $47,500. 5. Paid a $1,500 cash dividend to the stockholders. 6. Acquired an additional $25,000 cash from the issue of common stock. 7. Paid $9,000 cash to reduce the principal balance of the bank note. 8. Paid $58,000 cash to purchase land. 9. Determined that the market value of the land is $81,000 e. Determine the net cash flows from operating activities, investing activities, and financing activities that Maben would report on the Year 1 statement of cash flows (Enter cash outflows as negative amounts.) Net cash flows from operating activities Net cash flows from investing activities Net cash flows from financing activities
[The following information applies to the questions displayed below] Maben Company was started on January 1, Year 1, and experienced the following events during its first year of operation: 1. Acquired $35,000 cash from the issue of common stock. 2. Borrowed $35,000 cash from National Bank. 3. Earned cash revenues of $53,000 for performing services. 4. Paid cash expenses of $47,500. 5. Paid a $1,500 cash dividend to the stockholders. 6. Acquired an additional $25,000 cash from the issue of common stock. 7. Paid $9,000 cash to reduce the principal balance of the bank note. 8. Paid $58,000 cash to purchase land. 9. Determined that the market value of the land is $81,000 e. Determine the net cash flows from operating activities, investing activities, and financing activities that Maben would report on the Year 1 statement of cash flows (Enter cash outflows as negative amounts.) Net cash flows from operating activities Net cash flows from investing activities Net cash flows from financing activities
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![### Maben Company Financial Activities Overview
**Background:**
Maben Company commenced operations on January 1, Year 1. The following activities were recorded during its first year:
1. **Cash Acquisition from Common Stock:**
- Received $35,000 through issuing common stock.
2. **Borrowing:**
- Borrowed $35,000 from National Bank.
3. **Revenue from Services:**
- Generated cash revenues totaling $53,000 by providing services.
4. **Cash Expenses:**
- Incurred operating expenses amounting to $47,500.
5. **Dividend Payment:**
- Distributed $1,500 in dividends to stockholders.
6. **Additional Stock Issuance:**
- Acquired an extra $25,000 from issuing common stock.
7. **Debt Repayment:**
- Paid $9,000 towards reducing the principal of the bank note.
8. **Land Purchase:**
- Spent $58,000 in cash to acquire land.
9. **Land Valuation:**
- Determined the market value of the purchased land to be $81,000.
**Analysis Requirement:**
Determine the net cash flows associated with the following operational areas for Year 1:
- **Operating Activities**
- **Investing Activities**
- **Financing Activities**
**Instructions:**
Cash outflows should be recorded as negative amounts.
**Cash Flow Table:**
- **Net cash flows from operating activities**: [To be calculated]
- **Net cash flows from investing activities**: [To be calculated]
- **Net cash flows from financing activities**: [To be calculated]
Understanding these financial transactions can aid in assessing Maben Company's financial position and cash flow management in its inaugural year.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb0c53c3c-d25b-4f46-ae7f-d9559756d1d4%2F33cb0dd1-1c8c-4f21-97f6-9f97bea01130%2F7dn1sko_processed.jpeg&w=3840&q=75)
Transcribed Image Text:### Maben Company Financial Activities Overview
**Background:**
Maben Company commenced operations on January 1, Year 1. The following activities were recorded during its first year:
1. **Cash Acquisition from Common Stock:**
- Received $35,000 through issuing common stock.
2. **Borrowing:**
- Borrowed $35,000 from National Bank.
3. **Revenue from Services:**
- Generated cash revenues totaling $53,000 by providing services.
4. **Cash Expenses:**
- Incurred operating expenses amounting to $47,500.
5. **Dividend Payment:**
- Distributed $1,500 in dividends to stockholders.
6. **Additional Stock Issuance:**
- Acquired an extra $25,000 from issuing common stock.
7. **Debt Repayment:**
- Paid $9,000 towards reducing the principal of the bank note.
8. **Land Purchase:**
- Spent $58,000 in cash to acquire land.
9. **Land Valuation:**
- Determined the market value of the purchased land to be $81,000.
**Analysis Requirement:**
Determine the net cash flows associated with the following operational areas for Year 1:
- **Operating Activities**
- **Investing Activities**
- **Financing Activities**
**Instructions:**
Cash outflows should be recorded as negative amounts.
**Cash Flow Table:**
- **Net cash flows from operating activities**: [To be calculated]
- **Net cash flows from investing activities**: [To be calculated]
- **Net cash flows from financing activities**: [To be calculated]
Understanding these financial transactions can aid in assessing Maben Company's financial position and cash flow management in its inaugural year.
Expert Solution
Step 1: Introduction
Cash flow statement :— It is one of the financial statement that shows change in cash and cash equivalents during the period.
Three sections of cash flow statement are :—
- Cash flow from operating activities :— It shows change in cash due to business operation.
- Cash flow from investing activities :— It shows change in cash due to sale or purchase of assets.
- Cash flow from financing activities :— It shows change in cash due to issuance or repayment of securities.
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