Classifications of Cash Flows – A company’s statement of cash flows and the accompanying schedule of investing and financing activities not affecting cash may contain the following major sections:
A. Net Cash Flow From Operating Activities
B. Cash Flows From Investing Activities
C. Cash Flows From Financing Activities
D. Investing and Financing Activities Not Affecting Cash
The following is a list of items that might appear on a company’s statement of cash flows or in the accompanying schedule.
1. Decrease in accounts payable
2. Payment of dividends
3. Increase in income taxes payable
4. Proceeds from issuance of note
5. Payment for purchase of available for- sale temporary investments
6. Amortization of premium on investment in bonds
7. Increase in prepaid expenses
8. Payment of note
9. Gain on sale of equipment
10. Proceeds from sale of land
11. Net income
12. Payment for acquisition of building
13. Depreciation expense
14. Issuance of common stock for land
15. Proceeds (principal) from collection of note
16. Amortization of discount on bonds payable
17. Decrease in deferred taxes payable
18. Proceeds from issuance of bonds
19. Issuance of stock dividend
20. Payment for purchase of treasury stock
21. Depletion expense
22. Increase in inventory
23. Conversion of preferred stock to common stock
24. Proceeds from issuance of stock
25. Lease of equipment under capital lease
26. Proceeds from sale of patent
Required
In the space provided and using the letters A through D, indicate in which section of the statement of cash flows (or the accompanying schedule) the preceding items would most likely be classified. After each letter indicate with a plus (+) or a minus (-) whether the items would be reported as an increase (inflow) or decrease (outflow). If an item would not be reported in the statement (or the accompanying schedule), put an X in the space provided.