Cray Cray is a merchandiser of gag gifts. The? company’s net income for the prior year was? $13,200. The beginning Retained Earnings reported on the Balance Sheet was? $10,000. The ending Retained Earnings reported on the Balance Sheet was? $8,900. The company began the year with? $18,000 in cash. Its cash flow from operating activities for the year was? $12,130.
The following additional transactions occurred during the? year: ?
• An old piece of equipment was sold for? $1,500 cash and replaced with a new piece of equipment that cost? $9,450. The company made a down payment using? $450 from its bank account and financed the remaining balance by taking out a cash loan with the bank.
?• 500 shares of common stock were issued at par for a total of? $1,000 in cash.
?• The Dividends Payable account balance was? $0 at the beginning and the end of the year.
Answer the following given the above? information:
1) The company is not operating within its means.
True
False
2) The investing activities provided more cash than the investing activities used.
True
False
3) The financing activities used more cash than the financing activities provided.
True
False
4) The? company’s ending cash balance reported on the Balance Sheet is $________. (enter the absolute value and commas where ?appropriate)