The following transactions occurred during March 2018 for the Wainwright Corporation. The company owns and operates a wholesale warehouse.

1) Issued 30,000 shares of capital 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 was signed for the balance owed.

3) Purchased inventory on account at a cost of $90,000. The company uses 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 building for the month of March.

6) Paid $6,000 to an insurance company for fire and liability insurance for a one-year period beginning April 1, 2018.

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, and/or operating activity (a transaction can represent more than one type of activity). 2. Prepare a statement of cash flows, using the direct method to present cash flows from operating activities. Assume the cash balance at the beginning of the month was $40,000.

Analyze each transaction by indicating the cash effect and classify each as a financing, investing, and/or operating activity (a transaction can represent more than one type of activity). (Amounts to be deducted should be indicated with a minus sign. If there is no cash effect, leave cell blank.)

	Operating	Investing	Financing
1.	$30,000
2.		40,000
3.
4.
5.
6.
7.
8.
9.
	$30,000	$40,000	$0	=

Prepare a statement of cash flows, using the direct method to present cash flows from operating activities. Assume the cash balance at the beginning of the month was $40,000. (Amounts to be deducted should be indicated with a minus sign.)

WAINWRIGHT CORPORATION
Statement of Cash Flows
For the Month Ended March 31, 2018
		$0
		0
		0
		0
		$0
Noncash investing and financing activities:
Cost of equipment
Cash paid
Note issued		$0