E 21-1 Classification of cash flows LO21-3 through LO21-6 Listed below are several transactions that typically produce either an increase or a decrease in cash. Indicate by letter whether the cash effect of each transaction is reported on a statement of cash flows as an operating (O), investing (I), or financing (F) activity. Transactions F 1. Sale of common stock. 2. Sale of land. 3. Purchase of treasury stock. 4. Merchandise sales. 5. Issuance of a long-term note payable. 6. Purchase of merchandise. 7. Repayment of a note payable. 8. Employee salaries. 9. Sale of equipment at a gain. 10. Issuance of bonds. 11. Acquisition of bonds of another corporation. 12. Payment of semiannual interest on bonds payable. 13. Payment of a cash dividend. 14. Purchase of a building. 15. Collection of nontrade note receivable (principal amount). 16. Loan to another company. 17. Retirement of common stock. 18. Income taxes. 19. Issuance of a short-term note payable. 20. Sale of a copyright