Tim Latimer Ltd. had the following transactions.

1. Sold land (cost £12,000) for £10,000.

2. Issued ordinary shares at par value for £18,000.

3. Recorded depreciation on buildings for £14,000.

4. Paid salaries of £7,000.

5. Issued 1,000 shares of £1 par value ordinary shares for equipment worth £9,000.

6. Sold equipment (cost £10,000, accumulated depreciation £8,000) for £3,500.

Instructions

For each transaction above, (a) prepare the journal entry, and (b) indicate how it would affect the statement of cash flows under the indirect method.