Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger

Exercise 23

Activity Classification
Stillwater Designs is a private company and outsources production of its Kicker speaker lines. Suppose that Stillwater Designs provided you the following transactions.
a. Sold a warehouse for $750,000.
b. Reported a profit of $100,000.
c. Retired long-term bonds.
d. Paid cash dividends of $350,000.
e. Obtained a mortgage for a new building from a local bank.
f. Purchased a new robotic system.
g. Issued a long-term note payable.
h. Purchased a 40% interest in a company.
i. Reported a loss for the year.
j. Negotiated a long-term loan.
Required:
Classify each of these transactions as an operating activity, an investing activity, or a financing activity. Also, indicate whether the activity is a source of cash or a use of cash.