FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 16: Reporting the Statement of Cash Flows

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 81

Multiple Choice

Review LaterAdd Note

Review Later

The purchase of long-term assets by issuing a note payable for the entire amount is reported on the statement of cash flows in the:

A) Operating activities.
B) Financing activities.
C) Investing activities.
D) Schedule of noncash financing and investing activities.
E) Reconciliation of cash balance.

F) B) and C)
G) A) and B)

Correct Answer

verified

Show Answer

Question 82

Multiple Choice

Review LaterAdd Note

Review Later

The statement of cash flows helps address questions such as

A) How is the increase in investments financed?
B) What is the source of cash for new plant assets?
C) How much cash is generated from or used in operations?
D) Why is cash flow from operations different from income?
E) All of these.

F) D) and E)
G) A) and B)

Correct Answer

verified

Show Answer

Question 83

Multiple Choice

Review LaterAdd Note

When preparing a statement of cash flows on the indirect method, each of the following should be classified as an operating activity cash flow except:

The cash flow on total assets ratio can be used as an indicator of earnings quality.

Describe the format of the statement of cash flows, including the reporting of significant noncash investing and financing activities.

A company's income statement showed the following: net income, $124,000; depreciation expense, $30,000; and gain on sale of plant assets, $14,000. An examination of the company's current assets and current liabilities showed the following changes as a result of operating activities: accounts receivable decreased $9,400; merchandise inventory increased $18,000; prepaid expenses decreased $6,200; accounts payable increased $3,400. Calculate the net cash provided or used by operating activities.

The accounting principle that requires important noncash financing and investing activities be reported on the statement of cash flows or in a footnote is the:

Business activities that generate or use cash are classified as operating, investing, or financing activities on the statement of cash flows.

Noncash investing and financing activities may be disclosed in:

Which of the following transactions or events should be reported as a source of cash from operating activities when using the direct method?

Use the following information and the indirect method to calculate the net cash provided or used by operating activities:

Sebring Company reports depreciation expense of $40,000 for Year 2. Also, equipment costing $140,000 was sold for a $10,000 loss in Year 2. The following selected information is available for Sebring Company from its comparative balance sheet. Compute the cash received from the sale of the equipment.

Which one of the following is representative of typical cash flows from operating activities?

The purchase of stock in another company is classified as a financing activity.

Beewell's net income for the year ended December 31, Year 2 was $185,000. Information from Beewell's comparative balance sheets is given below. Compute the cash paid for dividends during Year 2.

The first line item in the operating activities section of a spreadsheet for a statement of cash flows prepared using the indirect method is:

Investing activities include: (a) the purchase and sale of long-term assets, (b) lending and collecting on notes receivable, and (c) the purchase and sale of short-term investments in the securities of other entities, other than cash equivalents and trading securities.

Analysis reveals that a company had a net decrease in cash of $4,000 for the current year. Net cash provided by operating activities was $18,000; net cash used in investing activities was $10,000 and net cash used in financing activities was $12,000. If the year-end cash balance is $21,000, the beginning cash balance was:

___________________ activities include those transactions that affect long-term liabilities and equity.

The direct method for preparing and reporting the statement of cash flows reports net income and then adjusts it for items necessary to calculate net cash provided or used by operating activities.