Changes in Working Capital (LO5)

Following is a list of typical financial, investing, and operating transactions. For each transaction indicate whether current assets, current liabilities, and working capital either increased, decreased, or are unchanged. Use the following column headings and relation: Current assets — Current liabilities =

Working capital.

a. Sold capital stock for cash.

Purchased a building for cash.

c. Paid current liabilities with cash.

d. Issued long-term bonds payable for cash.

e. Purchased inventory on account.

f. Purchased a building site by issuing long-term bonds.

g. Sold equipment for a cash amount equal to book value.

h. Sold treasury stock for cash.

i. Along-term note matures next year is reported as a current payable at this year-end. LO.1