Question

Required information The following information applies to the questions displayed below) The following events apply to Gulf Seafood for the Year 1 fiscal year: 1. The company started when it acquired $18,000 cash by issuing common stock 2. Purchased a new cooktop that cost $16,400 cash. 3. Earned $22,500 in cash revenue 4. Paid $10,700 cash for salaries expense. 5. Adjusted the records to reflect the use of the cooktop. Purchased on January 1, Year 1, the cooktop has an expected useful life of four years and an estimated salvage value of $3.000. Use straight line depreciation. The adjusting entry was made as of December 31, Year 1 Required a. Record the above transactions in a horizontal statements model in the Cosh Flow column, indicate whether the item is an operating activity (OA), an investing activity (IA), a financing activity (FA) and net change in cash (NC). Enter any decreases to account balances and cash outflows with a minus sign. Not all cells in the Statement of Cash Flows column may require an input - leave cells blank if there is no corresponding input needed.) GUL SEAFOOD Horizontal Statements Model Balance Sheet Equity Retailed Statement of Cash Flows Expense Net Income Equipment Accumulated Depreciation Coon Stock

Answer 1

	Cash	Equipment	Accumulated depreciation	common stock	retained earnings	revenue	expenses	net income	cash flow
1	$         18,000			$        18,000				$                   -	$         18,000	FA
2	$       (16,400)	$        16,400						$                   -	$       (16,400)	IA
3	$         22,500				$         22,500	$        22,500		$         22,500	$         22,500	OA
4	$       (10,700)				$       (10,700)		$        10,700	$       (10,700)	$       (10,700)	OA
5			$        3,350		$         (3,350)		$          3,350	$         (3,350)	$                   -	NA
Balance	$         13,400	$        16,400	$        3,350	$        18,000	$            8,450	$        22,500	$        14,050	$            8,450	$         13,400

Ques 2
depreciaition	3350
(16400-3000)/4
Ques 3
acc. Dep	6700
(3350+3350)
Ques 4
No, depreciaition is non cash expense