Reference no: EM131692857
Question - Record transactions, post to the Cash T-account, and prepare the statement of cash flows
Rocky owns and operates Balboa's Gym located in Philadelphia. The following transactions occur for the month of October:
October 2 Receive membership dues for the month of October totaling $7,700.
October 5 Issue common stock in exchange for cash, $12,000.
October 9 Purchase additional boxing equipment for $8,800, paying one-half of the amount in cash and the other one-half on account due by the end of the year.
October 12 Pay $1,200 for advertising in October regarding a special membership rate available during the month of October.
October 19 Pay dividends to stockholders, $3,600.
October 22 Pay liability insurance to cover accidents to members for the next six months, starting November 1, $6,900.
October 25 Receive cash in advance for November memberships, $4,800.
October 30 Receive, but do will not pay in October, utilities bill for the month of October, $4,400.
October 31 Pay employees' salaries for the month, $6,500.
Assume the balance of cash at the beginning of October is $15,800. Post each cash transaction to the cash T-account.
Prepare a statement of cash flows for the month of October, properly classifying each of the cash transactions into operating, investing, and financing activities.