[stina71223]

Hi!

I have a work problem that could be helpful for the exam. I just can’t seem to figure it out but maybe some fresh eyes can provide insight .

For the financing section-
The financing section is made up of proceeds from new Ltd, principal payments for Ltd, proceeds from sale of stock, payments for treasury stock and distributions paid etc.
For this I have analyzed changes in Ltd and payments along with changes in retained earnings and other equity accounts.
We had a treasury stock transaction that debited retained earnings as apic was maxed out and common stock was adjusted for par. The treasury stock also created a note for a 10 year arrangement. The entry:
Debit
Common stock
Apic
Retained earnings
Credit
Note playable
I recorded this note in the gl and included it in the changes in Ltd category. We made an initial payment towards this note at inception.
Debit
Note playable
Credit
Cash
the note related to this is stated at net on the cash flow statement. All other Ltd activity accounted for as well and my Ltd activity balances for the principal payments category of the financing activity section.
The changes in retained earnings, as mentioned before, include a portion of the record of the note at inception. After distributions, net income and the treasury stock portion are accounted for in retained earnings, I am off by the initial payment for the treasury stock transaction.

My worksheet works horizontally, kinda like this:
Columns:Ltd] common stock] apic] retained earnings
Rows: payments for treasury stock
Principal payments on Ltd
Distributions
Proceeds from issuance of Ltd
The figures in the columns should net to the net increase or decrease in cash flows for financing activities by category.

Again the problem : retained earnings column is off by the initial payment made of the treasury stock.

If you’ve read this far, thank you. 🙂 wish I could send A file. Visuals are easier to work with for sure.