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please help me this with specific explainations. I want to learn and know clearly about all those 3 operating, investing, financing activities. The following transactions
please help me this with specific explainations. I want to learn and know clearly about all those 3 operating, investing, financing activities.
The following transactions occurred during March 2021 for the Wainwright Corporation. The company owns and operates a wholesale warehouse. 1. Issued 30,000 shares of common stock in exchange for $300,000 in cash 2. Purchased equipment at a cost of $40.000.$10.000 cash was paid and a note payable to the seler was signed for the balance oved. 3. Purchased inventory on account at a cost of 590.000. The company usos the perpetual inventory system. 4. Credit sales for the month totaled $120,000 The cost of the goods sold was $70,000. 5. Paid $5,000 in rent on the warehouse bulding for the month of March. 6. Paid 56,000 to an insurance company for fre and Eabilly insurance for a one-year period beginning April 1, 2021. 7. Paid $70,000 on account for the merchandise purchased in 3. 8. Collected $55,000 from customers on account. 9. Recorded depreciation expense of $1,000 for the month on the equipment Required: 1. Analyze each transaction by indicating the cash effect and classify each as a financing, investing, andior operating activity (a) transaction can represent more than one type of activity. 2. Prepare a statement of cash fows, using the direct method to present cash flows from operating activities. Assume the cash balance at the beginning of the month was $40.000 Step by Step Solution
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