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The following information was drawn from the year-end balance sheets of Solomon River, Inc. Account Year 2 Title Year 1 Bonds $750,000 $1,005,000 payable 213,000 121,000 Common stock Treasury 27,500 5,500 stock Retained 88,900 62,200 earnings Additional information regarding transactions occurring during Year 2: 1. Solomon River, Inc. issued $42,300 of bonds during Year 2. The bonds were issued at face value. All bonds retired were retired at face value. 2. Common stock did not have a par value. 3. Solomon River, Inc. uses the cost method to account for treasury stock. 4. The amount of net income shown on the Year 2 income statement was $32,70. Required a. Determine the amount of cash flow for the retirement of bonds that should appear on the Year 2 statement of cash flows. b. Determine the amount of cash flow from the issue of common stock that should appear on the Year 2 statement of cash flows. c. Determine the amount of cash flow for the purchase of treasury stock that should appear on the Year 2 statement of cash flows. d. Determine the amount of cash flow for the payment of dividends that should appear on the Year 2 statement of cash flows. e. Prepare the financing activities section of the Year 2 statement of cash flows. Complete this question by entering your answers in the tabs below. Req A to Req E D Prepare the financing activities section of the year 2 statement of cash flows. (Cash outflows should be indicated with minus sign.) Cash Flows from financing activities Proceeds from issue of bond liabilities Proceeds from issue of common stock Paid for purchase of treasury stock $ 297,300 92,000 22,000 Net cash flow from financing activities $ 411,300

The following information was drawn from the year-end balance sheets of Solomon River, Inc. Account Year 2 Title Year 1 Bonds $750,000 $1,005,000 payable 213,000 121,000 Common stock Treasury 27,500 5,500 stock Retained 88,900 62,200 earnings Additional information regarding transactions occurring during Year 2: 1. Solomon River, Inc. issued $42,300 of bonds during Year 2. The bonds were issued at face value. All bonds retired were retired at face value. 2. Common stock did not have a par value. 3. Solomon River, Inc. uses the cost method to account for treasury stock. 4. The amount of net income shown on the Year 2 income statement was $32,70. Required a. Determine the amount of cash flow for the retirement of bonds that should appear on the Year 2 statement of cash flows. b. Determine the amount of cash flow from the issue of common stock that should appear on the Year 2 statement of cash flows. c. Determine the amount of cash flow for the purchase of treasury stock that should appear on the Year 2 statement of cash flows. d. Determine the amount of cash flow for the payment of dividends that should appear on the Year 2 statement of cash flows. e. Prepare the financing activities section of the Year 2 statement of cash flows. Complete this question by entering your answers in the tabs below. Req A to Req E D Prepare the financing activities section of the year 2 statement of cash flows. (Cash outflows should be indicated with minus sign.) Cash Flows from financing activities Proceeds from issue of bond liabilities Proceeds from issue of common stock Paid for purchase of treasury stock $ 297,300 92,000 22,000 Net cash flow from financing activities $ 411,300

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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The following information was drawn from the year-end balance sheets of Solomon River, Inc. Account Year 2 Title Year 1 Bonds $750,000 $1,005,000 payable 213,000 121,000 Common stock Treasury 27,500 5,500 stock Retained 88,900 62,200 earnings Additional information regarding transactions occurring during Year 2: 1. Solomon River, Inc. issued $42,300 of bonds during Year 2. The bonds were issued at face value. All bonds retired were retired at face value. 2. Common stock did not have a par value. 3. Solomon River, Inc. uses the cost method to account for treasury stock. 4. The amount of net income shown on the Year 2 income statement was $32,70. Required a. Determine the amount of cash flow for the retirement of bonds that should appear on the Year 2 statement of cash flows. b. Determine the amount of cash flow from the issue of common stock that should appear on the Year 2 statement of cash flows. c. Determine the amount of cash flow for the purchase of treasury stock that should appear on the Year 2 statement of cash flows. d. Determine the amount of cash flow for the payment of dividends that should appear on the Year 2 statement of cash flows. e. Prepare the financing activities section of the Year 2 statement of cash flows. Complete this question by entering your answers in the tabs below. Req A to Req E D Prepare the financing activities section of the year 2 statement of cash flows. (Cash outflows should be indicated with minus sign.) Cash Flows from financing activities Proceeds from issue of bond liabilities Proceeds from issue of common stock Paid for purchase of treasury stock $ 297,300 92,000 22,000 Net cash flow from financing activities $ 411,300
Transcribed Image Text:The following information was drawn from the year-end balance sheets of Solomon River, Inc. Account Year 2 Title Year 1 Bonds $750,000 $1,005,000 payable 213,000 121,000 Common stock Treasury 27,500 5,500 stock Retained 88,900 62,200 earnings Additional information regarding transactions occurring during Year 2: 1. Solomon River, Inc. issued $42,300 of bonds during Year 2. The bonds were issued at face value. All bonds retired were retired at face value. 2. Common stock did not have a par value. 3. Solomon River, Inc. uses the cost method to account for treasury stock. 4. The amount of net income shown on the Year 2 income statement was $32,70. Required a. Determine the amount of cash flow for the retirement of bonds that should appear on the Year 2 statement of cash flows. b. Determine the amount of cash flow from the issue of common stock that should appear on the Year 2 statement of cash flows. c. Determine the amount of cash flow for the purchase of treasury stock that should appear on the Year 2 statement of cash flows. d. Determine the amount of cash flow for the payment of dividends that should appear on the Year 2 statement of cash flows. e. Prepare the financing activities section of the Year 2 statement of cash flows. Complete this question by entering your answers in the tabs below. Req A to Req E D Prepare the financing activities section of the year 2 statement of cash flows. (Cash outflows should be indicated with minus sign.) Cash Flows from financing activities Proceeds from issue of bond liabilities Proceeds from issue of common stock Paid for purchase of treasury stock $ 297,300 92,000 22,000 Net cash flow from financing activities $ 411,300
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