7. Consider the effects of the independent transactions, a through i, on a companys balance sheet, income statement, statement of cash flows, and statement of stockholders equity.

a. The company purchased inventory on credit.

b. The company sold all inventory purchased in transaction a) on credit (and for more than its cost).

c. The company collected cash from customers from transaction b).

d. The company purchased equipment with cash.

e. The company paid cash for a note payable that came due.

f. The company paid cash for interest on borrowings.

g. Wages were earned by company employees but not yet paid.

h. The company paid cash in dividends.

i. The company received cash for the issuance of stock.

Complete the table below to explain the effects and financial statement linkages. Use + to indicate the account increases and to indicate the account decreases (15 pts).

a.

b.

c.

d.

e.

f.

g.

h.

i.

Balance sheet

Cash

Noncash assets

Total liabilities

Contributed capital

Retained earnings

Statement of cash flows

Operating cash flow

Investing cash flow

Financing cash flow

Income statement

Revenues

Expenses

Net earnings

Statement of stockholders equity

Contributed capital

Retained earnings