ACCY 1 Fall 2019 Practice Questions #1. Selected transactions of the Carolina Company are listed below. 1. Common stock is sold for cash above par value 2. Bonds payable are issued for cash at a discount. 3 Interest on a short-term note receivable is collected 4. Merchandise is sold to customers for cash 5. Cash is paid to purchase inventory. 6. Equipment is purchased by signing a 3-year, 10% note payable. 7. Cash dividends on common stock are declared and paid. 8. One hundred shares of Amazon.com common stock are purchased for cash. 9. Land is sold for cash at book value. 10. Bonds payable are converted into common stock 11. Collected accounts receivable. 12. Declared and paid dividends on common stock. 13. Sold long-term investments for cash. 14. Issued stock for equipment. 15. Repaid five-year note payable. 16. Pald employee wages 17. Converted bonds payable to common stock 18. Acquired long-term investment with cash 19. Sold buildings and equipment for cash. Instructions Classify each transaction as either (a) an operating activity, (b) an investing activity. (c) a financing activity, or (d) a noncash investing and financing activity. #2. Lake Norman Company reported net income of $225,000 for the current year. Depreciation recorded on buildings and equipment amounted to $75,000 for the year. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $20,000 $15.000 Accounts receivable 22,000 32,000 Inventory 50,000 60,000 Accounts payable 12,000 18,000 Instructions Prepare the cash flows from the operating activities section of the statement of cash flows using the indirect method