Question
Prepare the Statement of Cash Flows for Smart Touch Learning for the month ended December 31, 2016 from the provided information. Within each section of the statement, use the drop-down menus to enter the accounts. Then enter the account balances and calculate ending balances. Enter decreases in cash with a minus sign or parentheses.
Cash balance, December 1, 2016 is $18,500
Transactions
Dec. 1 Common stock was issued to stockholders for $7,900 cash.
7 Purchased equipment for $1,700 on account.
14 Paid $20,000 cash for land.
17 Paid cash expenses: office rent, $1,500; employees' salaries, $1,400; utilities, $100.
23 Paid cash dividends of $2,300.
26 Earned service revenue for the month, $5,000, receiving cash.
Cash balance, December 1, 2016 is $18,500
Transactions
Dec. 1 Common stock was issued to stockholders for $7,900 cash.
7 Purchased equipment for $1,700 on account.
14 Paid $20,000 cash for land.
17 Paid cash expenses: office rent, $1,500; employees' salaries, $1,400; utilities, $100.
23 Paid cash dividends of $2,300.
26 Earned service revenue for the month, $5,000, receiving cash.
Answers
GPT-4o mini
To prepare the Statement of Cash Flows for Smart Touch Learning for the month ended December 31, 2016, we'll follow the cash flow classification categories: Operating Activities, Investing Activities, and Financing Activities.
### Smart Touch Learning
### Statement of Cash Flows
### For the Month Ended December 31, 2016
**Cash Flows from Operating Activities:**
- Cash received from service revenue: $5,000
- Cash paid for office rent: $(1,500)
- Cash paid for employees' salaries: $(1,400)
- Cash paid for utilities: $(100)
**Net Cash Provided by Operating Activities:**
= $5,000 - $1,500 - $1,400 - $100
= $5,000 - $3,000
= **$2,000**
**Cash Flows from Investing Activities:**
- Cash paid for land: $(20,000)
- Cash paid for equipment (not directly affecting cash, as it was on account): $0
**Net Cash Used in Investing Activities:**
= $(20,000)
**Cash Flows from Financing Activities:**
- Cash received from issuing common stock: $7,900
- Cash paid for dividends: $(2,300)
**Net Cash Provided by Financing Activities:**
= $7,900 - $2,300
= **$5,600**
**Net Increase in Cash:**
= Cash from Operating Activities + Cash from Investing Activities + Cash from Financing Activities
= $2,000 + $(20,000) + $5,600
= $2,000 - $20,000 + $5,600
= $(12,400)
**Cash Balance at Beginning of Period:**
= $18,500
**Cash Balance at End of Period:**
= Beginning Cash + Net Increase in Cash
= $18,500 + $(12,400)
= $18,500 - $12,400
= **$6,100**
### Summary:
- **Cash from Operating Activities:** $2,000
- **Cash from Investing Activities:** $(20,000)
- **Cash from Financing Activities:** $5,600
- **Net Increase in Cash:** $(12,400)
- **Ending Cash Balance:** $6,100
This summarizes all transactions in the Statement of Cash Flows based on the provided data.
### Smart Touch Learning
### Statement of Cash Flows
### For the Month Ended December 31, 2016
**Cash Flows from Operating Activities:**
- Cash received from service revenue: $5,000
- Cash paid for office rent: $(1,500)
- Cash paid for employees' salaries: $(1,400)
- Cash paid for utilities: $(100)
**Net Cash Provided by Operating Activities:**
= $5,000 - $1,500 - $1,400 - $100
= $5,000 - $3,000
= **$2,000**
**Cash Flows from Investing Activities:**
- Cash paid for land: $(20,000)
- Cash paid for equipment (not directly affecting cash, as it was on account): $0
**Net Cash Used in Investing Activities:**
= $(20,000)
**Cash Flows from Financing Activities:**
- Cash received from issuing common stock: $7,900
- Cash paid for dividends: $(2,300)
**Net Cash Provided by Financing Activities:**
= $7,900 - $2,300
= **$5,600**
**Net Increase in Cash:**
= Cash from Operating Activities + Cash from Investing Activities + Cash from Financing Activities
= $2,000 + $(20,000) + $5,600
= $2,000 - $20,000 + $5,600
= $(12,400)
**Cash Balance at Beginning of Period:**
= $18,500
**Cash Balance at End of Period:**
= Beginning Cash + Net Increase in Cash
= $18,500 + $(12,400)
= $18,500 - $12,400
= **$6,100**
### Summary:
- **Cash from Operating Activities:** $2,000
- **Cash from Investing Activities:** $(20,000)
- **Cash from Financing Activities:** $5,600
- **Net Increase in Cash:** $(12,400)
- **Ending Cash Balance:** $6,100
This summarizes all transactions in the Statement of Cash Flows based on the provided data.