Question

Kiley Corporation had these transactions during 2017. Analyze the transactions and indicate whether each transaction is an operating activity, investing activity, financing activity, or noncash investing and financing activity.
(a) Purchased a machine for $30,000, giving a long-term note in exchange. select a kind of activity
(b) Issued $50,000 par value common stock for cash. select a kind of activity
(c) Issued $200,000 par value common stock upon conversion of bonds having a face value of $200,000. select a kind of activity
(d) Declared and paid a cash dividend of $13,000. select a kind of activity
(e) Sold a long-term investment with a cost of $15,000 for $15,000 cash. select a kind of activity (f) Collected $16,000 from sale of goods. select a kind of activity
(g) Paid $18,000 to suppliers.

Answer 1

Answer:

The answers are:

A) non cash investing and financing activity

B) financing activity

C) non cash investing and financing activity

D) financing activity

E) investing activity

F) operating activity

G) operating activity

Explanation:

• operating activity: relative to the functions of a business directly related to producing and selling goods or services
• investing activity: refers to buying and selling long-term assets and other investments
• financing activity: refer to transactions with creditors or investors used to fund company operations
• non cash investing and financing activity: refer to investing and financing activities that do not directly affect cash