TranscribedText: 3. Roddick Co. had the following transactions in May, the first month of its operations: a. Received $37,000 cash and a large delivery van with a value of $48,000 from investors, who were given 5,200 shares of $0.05 par value common stock. Purchased land with a warehouse by making a $16,000 down payment and signing a 10-year note payable to the local bank for $86,000. The land has a value of $24,000 and the building's value is $78,000. Use separate accounts for land and buildings. Purchased new computer equipment for $3,700 cash, and purchased other office equipment for $5,200, signing a note payable due in 1 year. d. Paid $2,200 on the note payable to the bank [in (b) above] (ignore interest). e. Purchased short-term investments in the stock of other companies for $6,200 cash. Required: 1. Prepare the above journal entries. 2. 3. Calculate the current ratio at May 31 (round to 2 decimal places). For each of the events, indicate if it is an investing or financing activity and the amount of the effect on cash flows. Use parentheses for cash outflows

3. Roddick Co. had the following transactions in May, the first month of its operations: a. Received $37,000 cash and a large delivery van with a value of $48,000 from investors, who were given 5,200 shares of $0.05 par value common stock. b. Purchased land with a warehouse by making a $16,000 down payment and signing a 10-year note payable to the local bank for $86,000. The land has a value of $24,000 and the building's value is $78,000. Use separate accounts for land and buildings. c. Purchased new computer equipment for $3,700 cash, and purchased other office equipment for $5,200, signing a note payable due in 1 year. d. Paid $2,200 on the note payable to the bank [in (b) above] (ignore interest). e. Purchased short-term investments in the stock of other companies for $6,200 cash. Required: 1. Prepare the above journal entries. 2. Calculate the current ratio at May 31 (round to 2 decimal places). 3. For each of the events, indicate if it is an investing or financing activity and the amount of the effect on cash flows. Use parentheses for cash outflows.