Question

SLO 4: Interpret the statement of cash flow and demonstrate the benefit to users.

The following activities took place at Mark's Corporation during their recent year. As the Accountant, you are responsible for recording the impact of these activities on the Statement of Cash Flow.

Instructions:

Of the activities listed below, you are to indicate if they represent a cash inflow (+) or outflow (-) and whether each is an Operating (O), Investing (I), or Financing (F) activity. Indicate your response by selecting an answer provided in the dropdown menus provided. Each activity requires two (2) answers to be considered a complete response.  

Example: If the first activity, "Payments to acquire investments in debt securities." represents a "Cash Inflow Activity (+)", you will choose that select from the dropdown menu provided in the 1st box. In addition to this response, you will indicate the type of activity that is being represented by Selecting either Operating Activity (O), Investing Activity (I), or Financing Activity (F) from the dropdown menu provided in the 2nd box. (24 Points Total)

Payments to acquire investments in debt securities.	[ Select ]                       ["Cash Inflow", "Cash Outflow"]	[ Select ]                       ["Investing", "Operating", "Financing"]
Dividends received on investments made in the stock of other corporations	[ Select ]                       ["Cash Outflow", "Cash Inflow"]	[ Select ]                       ["Financing", "Operating", "Investing"]
Payments for the acquisition of inventory.	[ Select ]                       ["Cash Outflow", "Cash Inflow"]	[ Select ]                       ["Financing", "Investing", "Operating"]
Proceeds from issuance of stock.	[ Select ]                       ["Cash Outflow", "Cash Inflow"]	[ Select ]                       ["Investing", "Financing", "Operating"]
Payments for interest on loans.	[ Select ]                       ["Cash Inflow", "Cash Outflow"]	[ Select ]                       ["Financing", "Investing", "Operating"]
Interest received on loans made to outside entities.	[ Select ]                       ["Cash Inflow", "Cash Outflow"]	[ Select ]                       ["Investing", "Operating", "Financing"]
Repayment of the principal on loans.	[ Select ]                       ["Cash Outflow", "Cash Inflow"]	[ Select ]                       ["Operating", "Investing", "Financing"]
Payment to acquire productive assets.	[ Select ]                       ["Cash Outflow", "Cash Inflow"]	[ Select ]                       ["Investing", "Operating", "Financing"]
Proceeds from the sale of productive assets	[ Select ]                       ["Cash Inflow", "Cash Outflow"]	[ Select ]                       ["Investing", "Financing", "Operating"]
Cash receipts from the sale of services.	[ Select ]                       ["Cash Outflow", "Cash Inflow"]	[ Select ]                       ["Operating", "Investing", "Financing"]
Payments of dividends to stockholders	[ Select ]                       ["Cash Outflow", "Cash Inflow"]	[ Select ]                       ["Investing", "Operating", "Financing"]
Payments to suppliers and for other expenses.	[ Select ]                       ["Cash Inflow", "Cash Outflow"]	[ Select ]                       ["Financing", "Investing", "Operating"]

Answer 1

Payments to acquire investments in debt securities.	Cash Outflow	Investing
Dividends received on investments made in the stock of other corporations	Cash Inflow	Investing
Payments for the acquisition of inventory.	Cash Outflow	Operating
Proceeds from issuance of stock.	Cash Inflow	Financing
Payments for interest on loans.	Cash Outflow	Financing
Interest received on loans made to outside entities.	Cash Inflow	Investing
Repayment of the principal on loans.	Cash Outflow	Financing
Payment to acquire productive assets.	Cash Outflow	Investing
Proceeds from the sale of productive assets	Cash Inflow	Investing
Cash receipts from the sale of services.	Cash Inflow	Operating
Payments of dividends to stockholders	Cash Outflow	Financing
Payments to suppliers and for other expenses.	Cash Outflow	Operating