ACCT 200 1st Edition Lecture 22 Outline of Last Lecture I. Journal Entry for Stock DividendsII. Balance Sheet for Stockholder’s EquityIII. E 10-12IV. Return on EquityV. BE 10-15VI. Earnings Per ShareVII. Exam 3 InformationOutline of Current Lecture I. Types of Cash Flow ActivitiesII. ExamplesCurrent Lectureoperating activity – anything to do with the income statement, changes in current assets or current liabilitiesInvesting activity – changes in long term assets – purchase or sale of property, plant, equipment;purchase or sale of long term investmentsFinancing activity – sale of common or preferred stock, purchase of treasury stock, borrowing money (proceeds from borrowing money), repayment of debt/loans, payment of cash dividendsNeed to know if each provides cash coming in or cash going outNon-cash activity – buying equipment with shares of stock, converting debt into common stock, buying equipment with debt only (no cash)E 11-4Issue 20 million in bonds – financing, money +Purchase of equipment $80,000 – investing, money -Pay acct payable off $20,000 – operating, money –Collect acct receivable of $15,000 – operating, money +Exchange common stock for land $300,000 – non-cash transactionPay a cash dividend of $10,000 – financing, money –What is the cash flow from operating activity? -20,000 + 15,000= -5000 operating activityPurchase of long term investment – investing, money -Purchase of inventory for $40,000 – operating, money -Cash sales to customers for $100,000 – operating, money +Payment of wages expense $20,000 – operating, money –Convert acct receivable information into cash flow informationSales information with acct receivableBegin acct rec + sales –end acct receivable=cash collections from customersBegin acct payable + purchase –end acct payable=cash payments to venders (businesses purchased
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