The following events apply to Gulf Seafood for the Year $1$ fiscal year:

The company started when it acquired $$60,000$ cash by issuing common stock.

Purchased a new cooktop that cost $$40,000$ cash.

Earned $$72,000$ in cash revenue.

Paid $$25,000$ cash for salaries expense.

Adjusted the records to reflect the use of the cooktop. Purchased on January $1,$ Year $1,$ the cooktop has an expected useful life of four years and an estimated salvage value of $$4,000.$ Use straight$-$line depreciation. The adjusting entry was made as of December $31,$ Year $1.$

Required

a$.$ Record the previous transactions in a horizontal statements model. Also, in the Statement of Cash Flows column, classify the cash flows as operating activities $($OA$),$ investing activities $($IA$),$ or financing activities $($FA$).$

b$.$ What amount of depreciation expense would Gulf Seafood report on the Year $1$ income statement?

c$.$ What amount of accumulated depreciation w$$uld Gulf Seafood report on the December $31,$ Year $2,$ balance sheet?

d$.$ Would the cash flow from operating activities be affected by depreciation in Year $1?$

Complete this question by entering your answers in the tabs below.

Record the previous transactions in a horizontal statements model. Also, in the Statement of Cash Flows column, classify the cash flows as operati activities $($IA$),$ or financing activities $($FA$).$

Note: Enter any decreases to account balances and cash outflows with a minus sign. Leave cells blank if no input is needed.

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