Johnson Company Engaged in the Following Transactions During 2010: 1

question 57

Multiple Choice

Johnson Company engaged in the following transactions during 2010: 1. Johnson wrote off an open receivable as uncollected.
2) Johnson purchased a piece of plant equipment
3) Johnson reacquired 5,000 shares of its common stock.
4) Johnson sold a building at a loss in exchange for a five-year note.
5) Johnson declared, but did not pay a cash dividend.
If Johnson uses the indirect method, which of these transactions or parts of these transactions would be included in the operating activity section of the statement of cash flows?

• A) Transaction 4
• B) Transaction 1
• C) More than one of these transactions would be found in the operating activity section.
• D) None of these transactions would be found in the operating activity section.

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