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The statement of cash flows categorizes like transactions for optimal reporting.

Identify each item as a(n):

  • Operating activity—add to net income (O+) or subtraction from net inc. (O–)
  • Investing activity—cash inflow (I+) or cash outflow (I–)
  • Financing activity—cash inflow (F+) or cash outflow (F–)
  • Non-cash Investing and Financing activity (N)

Cash Flow ItemsClassification
Payment of long-term debt
Depreciation expense
Acquiring equipment by issuing Note payable
Issuance of common stock
Decrease in Accrued Liabilities
Net Income
Purchase of treasury stock
Issuing a long-term note payable to borrow cash
Acquiring building for common stock
Increase in Accounts Payable
Payment of cash dividend
Increase in Prepaid Expense
Increase in Salaries Payable
Decrease in Merchandise Inventory
Loss on sale of land
Cash sale of land


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   x    (   ) π DNE
( ) ( ] [ ) [ ] —∞ DNE
< > or All Real Numbers DNE
log logn ln n  | | e 
sin cos tan arcsin arccos arctan  
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