For the Smith Company, what amount of cash, ending retained earnings, and cash f
ID: 2419229 • Letter: F
Question
For the Smith Company, what amount of cash, ending retained earnings, and cash flows from investing activities would be reported on the company’s balance sheet?
The Smith Company had the following transactions
Jan. 1
Owner invested $12,400 cash to start the company
Jan. 3
Purchased $850 of equipment on account
Jan. 9
Purchased $2,800 of inventory
Jan. 14
Paid rent of $620
Jan. 24
Sold ¼ of inventory to customers for $875
Jan. 31
Paid employee payroll of $1,200
Jan. 1
Owner invested $12,400 cash to start the company
Jan. 3
Purchased $850 of equipment on account
Jan. 9
Purchased $2,800 of inventory
Jan. 14
Paid rent of $620
Jan. 24
Sold ¼ of inventory to customers for $875
Jan. 31
Paid employee payroll of $1,200
Explanation / Answer
Amount of cash = 12400 - 2800 -620 + 875 - 1200 = $8655
Ending retained earnngs = -700 -620 + 875 - 1200 = ($1645)
cash flows from investing activities = ($850)
Cash flows from financing activities = + $12400