Explanation T-account: T-account is the form of the ledger account, where the journal entries are posted to this account. It is referred to as the T-account, because the alignment of the components of the account resembles the capital letter ‘T’. The components of the T-account are as follows: a) The title of the account b) The left or debit side c) The right or credit side The T-accounts for Company R, for various accounts are shown below: Cash Account: Cash (Statement of Cash Flows) (Amount in millions) (13) $86 Cash Balance Operating activities: From customers (1) $1,954 (2) $1,523 To suppliers of goods (4) $456 For operating expenses Investing activities: Sale of equipment (7) $9 (6) $230 Purchase of equipment Financing activities: Issuance of note payable (8) $50 (9) $50 Payment of cash dividends Issuance of bonds payable (10) $160 Table (1) Accounts receivable (Amount in millions) Increase in Accounts receivable $46 Opening Balance $132 $178 Closing Balance Prepaid Insurance (Amount in millions) Increase in Prepaid Insurance $4 Opening Balance $3 $7 Closing Balance Inventory (Amount in millions) Increase in inventory $110 Opening Balance $175 $285 Closing Balance Buildings and Equipment (Amount in millions) Decrease in buildings and equipment $50 Opening Balance $230 $180 Closing Balance Accumulated Depreciation (Amount in millions) Decrease in accumulated depreciation $121 Opening Balance $171 $50 Closing Balance Accounts payable (Amount in millions) Decrease in accounts payable $13 Opening Balance $100 $87 Closing Balance Accrued Expenses Payable (Amount in millions) Decrease in accrued expenses $5 Opening Balance $11 $6 Closing Balance Notes Payable (Amount in millions) $50 Increase in Notes Payable Opening Bala...

9th Edition

ISBN: 9781259722660

Author: J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher: McGraw-Hill Education

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Chapter 21, Problem 21.32E

To determine

Statement of cash flows: This statement reports all the cash transactions which are responsible for inflow and outflow of cash and result of these transactions is reported as ending balance of cash at the end of reported period.

To Prepare: The Statement of cash flow for Company R, using the T-Accounts.

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Chapter 21, Problem 21.31E

Chapter 21, Problem 21.1P

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Solution Summary: The author explains that the T-account is the form of the ledger account, where the journal entries are posted to this account.

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