A review of the statement of financial position of Matvei Company revealed the following changes in the account balances:Required:1. For each of the above items, indicate whether it produces a cash inflow or a cash outflow.a.Increase in accounts receivableCash outflow b.Increase in retained earnings c.Decrease in salaries payable d.Increase in common shares e.Decrease in inventory f.Increase in accounts payable g.Decrease in long-term debt h.Increase in property, plant, and equipment 2. Classify each change as a cash flow from operating activities (indirect method), a cash flow from investing activities, or a cash flow from financing activities.a.Increase in accounts receivable b.Increase in retained earnings c.Decrease in salaries payable d.Increase in common shares e.Decrease in inventory f.Increase in accounts payable g.Decrease in long-term debt h.Increase in property, plant, and equipment

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Description: A review of the statement of financial position of Matvei Company revealed the following changes in the account balances:Required:1. For each of the above items, indicate whether it produces a cash inflow or a cash outflow.a.Increase in accounts rec

Cash flows from operating activities: It is a section of Statement of cash flow that explains the…

Answered: A review of the statement of financial…

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter7: Receivables And Investments

Section: Chapter Questions

Problem 7.16E

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A review of the statement of financial position of Matvei Company revealed the following changes in the account balances:

Required:

1. For each of the above items, indicate whether it produces a cash inflow or a cash outflow.

a.	Increase in accounts receivable	Cash outflow
b.	Increase in retained earnings
c.	Decrease in salaries payable
d.	Increase in common shares
e.	Decrease in inventory
f.	Increase in accounts payable
g.	Decrease in long-term debt
h.	Increase in property, plant, and equipment

2. Classify each change as a cash flow from operating activities (indirect method), a cash flow from investing activities, or a cash flow from financing activities.

a.	Increase in accounts receivable
b.	Increase in retained earnings
c.	Decrease in salaries payable
d.	Increase in common shares
e.	Decrease in inventory
f.	Increase in accounts payable
g.	Decrease in long-term debt
h.	Increase in property, plant, and equipment

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