Question
The following items are relevant to the preparation of a statement of cash flows for Tropical Products Inc. 1. Sale of common stock, $1,200,000. 2.
The following items are relevant to the preparation of a statement of cash flows for Tropical Products Inc.
1. Sale of common stock, $1,200,000.
2. Retirement of bonds payable, $852,000.
3. Purchase of land, $24,000.
4. Sale of equipment for $57,600, at a loss of $12,000.
5. Purchase of equity securities (not held in a trading account), $24,000.
6. Declaration of cash dividends, $96,000.
7. Loan of $72,000 resulting in a note receivable, nontrade.
8. Purchase of a patent, $48,000.
9. Proceeds from the issuance of a short-term nontrade note, $24,000.
a. Determine the amount of net cash flows that would be reported in the investing section of a statement of cash flows.
b. Determine the amount of net cash flows that would be reported in the financing section of a statement of cash flows.
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