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Posted by: johnsonj
Price Quoted by Student: $5
Posted On: 2011-06-25 05:05:04

Problem 11-2  

Explain what effect the following instructions would have on cash and how they would be shown in a cash flow statement.


1.         A $2,000,000 piece of equipment is purchased with the proceeds of a new 12 month note.

2.         mortgage bonds are retired with $790,000 cash and the proceeds of an issue of 150,000 shares of common stock.

3.         $2,000,000 of inventory is purchased on account.

4.         A dividend of $0.25 per share is declared on the 750,000 outstanding shares.

5.         A piece of machinery is sold for $1,500,000 cash. When originally purchased, it cost Anwat $5,000,000 and currently has $2,500,000 of accumulated depreciation.

Solution   Transaction Effect on
Price $5
Attachment 1: Explain what effect the following.doc
Solution Posted By: Johnsonj    Posted on: 25-06-2011