your
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Required
Explain how each of the following events or series of events and the related
- Paid $2,200 cash on October 1 to purchase a one-year insurance policy.
- Purchased $1,300 of supplies on account. Paid $700 cash on accounts payable. The ending balance in the Supplies account, after adjustment, was $350.
- Provided services for $7,600 cash.
- Collected $10,500 in advance for services to be performed in the future. The contract called for services to start on May 1 and to continue for one year.
- Accrued salaries amounting to $3,900.
- Sold land that cost $18,100 for $18,100 cash.
- Acquired $52,500 cash from the issue of common stock.
- Earned $10,400 of revenue on account. Collected $9,360 cash from
accounts receivable . - Paid cash for other operating expenses of $1,000.

Transcribed Image Text:Cash Flows from
Net Income
Event/
Operating Activities
Adjustment Direction of Amount of
Change
Direction of Amount of
Change
Change
Change
а.
Decrease
$
2,200
Adj.
Decrease
550
b.
Adj.
C.
Adj.
d.
Adj.
е.
Adj.
f.
Adj.
g.
Adj.
h.
Adj.
i.
Adj.
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