<span>When a firm's sales revenues are greater than its expenses, the firm has a positive cash flow. If the situation was opposite, then it would have a negative cash flow.</span>
Answer:
buy $300,000 worth of bonds
Explanation:
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Answer:
1 - Financing activity
2- Operating activity
3- Financing activity
4- Investing activity
5- Investing activity
Explanation:
Basically there are three types of activities:
1. Operating activities: It includes those transactions which affect the working capital, and it records transactions of cash receipts and cash payments.
2. Investing activities: It records those activities which include purchase and sale of the long term assets
3. Financing activities: It records those activities which affect the long term liability and shareholder equity balance.
So the categorization is shown below:
1. Issued $160,000 of bonds payable - cash flow from financing activity
2. Paid utilities expense - cash flow from operating activity
3. Issued 500 shares of preferred stock for $45,000 - cash flow from financing activity
4. Sold land and a building for $250,000 - cash flow from investing activity
5. Loaned $30,000 to Dead End Corporation, receiving Dead End’s 1-year, 12% note. - cash flow from investing activity
Answer: True
Explanation:
As a result of the Accrual principle in accounting, transactions need to be recorded in the period that they occur in and not in the period they are paid for in.
The interest in Year 1 was incurred in year 1 and so will need to be recorded in year 1 for the period from issuance of the note to the last day of the accounting period.
This means that if the last day of the accounting period is December 31st, the interest for year 1 would have to be accrued from September to December of year 1 and recorded as year 1 interest.
