Each of the following events describes acquiring an asset that requires a year-end adjusting entry. Explain how acquiring the asset and making the adjusting entry affect the amount of net income and the cash flow reported on the year-end financial statements. Also, in the Cash Flow column, indicate whether the cash flow is for operating activities (OA), investing activities (IA), or financing activities (FA). Use (NA) for no effect. Assume a December 31 annual closing date. The first event has been recorded as an example. Assume that any products that have been made have not been sold.

1. Paid \($4,000\) cash on January 1 to purchase printers to be used for administrative purposes. The printers had an estimated useful life of three years and a \($1,000\) salvage value.
2. Paid \($4,000\) cash on January 1 to purchase manufacturing equipment. The equipment had an estimated useful life of three years and a \($1,000\) salvage value.
3. Paid \($5,400\) cash in advance on May 1 for a one-year rental contract on administrative offices.
4. Paid \($5,400\) cash in advance on May 1 for a one-year rental contract on manufacturing facilities.
5. Paid \($1,000\) cash to purchase supplies to be used by the marketing department. At the end of the year, \($50\) of supplies was still on hand.
6. Paid \($1,000\) cash to purchase supplies to be used in the manufacturing process. At the end of the year, \($50\) of supplies was still on hand.

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Event No. 1. Purchase of printers 1. Make adjusting entry Net Income Amount of Change NA (1,000) Cash Flow Amount of Change (4,000) IA NA