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For each of the following transactions, indicate the section in which it may be included. Use O for the operating section, I for the investing activities section, and F for the financing section of the Statement of Cash Flows.
________ a. Payment of dividends
________ b. Issuance of stock
________ c. Payment of salaries
________ d. Cash purchase of equipment
________ e. Payment of accounts payable
________ f. Payment of interest on long-term debt
________ g. Receipt of cash dividends
________ h. Increase in accounts receivable
________ i. Cash sale of building
________ j. Gain on sale of land
Electronic Funds Transfer
An Electronic Funds Transfer (EFT) is the electronic movement of money from one bank account to another, either within a single financial institution or across multiple institutions, through computer-based systems.
Percentage Method
A way of calculating federal income tax withholding using percentage tables based on an employee's taxable income and filing status.
Federal Income Tax
A tax levied by the Internal Revenue Service on the annual earnings of individuals, corporations, trusts, and other legal entities.
Withholding Allowance
A predetermined amount of pre-tax income exempt from federal income taxes, directly affecting the amount of tax withheld from an employee's paycheck.
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