Exam 12: Statement of Cash Flows

Which of the following statements about the quality of income ratio is correct?

Which of the following would not be considered a cash equivalent?

A company acquired some land (independently appraised at $12,000)and paid for it by issuing 1,000 shares of its common stock (par $10 per share;no market price was quoted).How should this be reported on the statement of cash flows?

The following information has been provided to you by RKJ Company: Using the indirect method,what is the net cash provided by operating activities?

Which of the following transactions would not be reported within the investing section of the cash flow statement?

KJ Company,a manufacturer,uses the indirect method for preparing its statement of cash flows.The company has provided the following information pertaining to its recent year of operation: • Cash flow from operating activities,$136,000 • Accounts payable increased $11,000 • Prepaid assets decreased $8,000 • Depreciation expense was $12,000 • Accounts receivable increased $23,000 • Loss on sale of a depreciable asset was $6,000 • Wages payable decreased $9,000 • Unearned revenue decreased $19,000 • Patent amortization expense was $3,000 How much was KJ's net income?

Which of the following statements does not correctly describe an adjustment to net income when determining cash flows from operating activities using the indirect method?

Brooks Company reported net income of $40,000,which included depreciation expense and amortization expense of $21,000 and $18,000,respectively.The following changes also occurred during the year ended December 31,2019: Prepare the operating activities section of the statement of cash flows using the indirect method for the year ended December 31,2019.

A company reported an increase in accounts receivable and an increase in unearned sales revenues during 2019.Which of the following statements is correct?

Flow Company has provided the following information for the year ended December 31,2019: • Cash paid for interest,$20,000 • Cash paid for dividends,$6,000 • Cash dividends received,$4,000 • Cash proceeds from bank loan,$29,000 • Cash purchase of treasury stock,$11,000 • Cash paid for equipment purchase,$27,000 • Cash received from issuance of common stock,$37,000 • Cash received from sale of land with a $32,000 book value,$25,000 • Acquisition of land costing $51,000 in exchange for preferred stock issuance • Payment of a $100,000 note payable by exchanging used machinery with a $77,000 book value and $100,000 fair value - How much was Flow's net cash flow from investing activities?

Which of the following transactions is not reported in the statement of cash flows as a cash flow from investing activities?

Significant noncash financing and investing activities:

Halbur Company reported the following for its recent year of operation: No new equipment was purchased during the year.What was the selling price of the equipment?

Brice Corporation reported the following information: Compute Brice's cash paid to suppliers for inventory for 2019.

Reliance Corporation has provided the following information for the year ended December 31,2019: • The equipment account balance increased $200,000. • The equipment accumulated depreciation account balance increased $35,000. • Equipment costing $50,000 was sold during the year resulting in a $10,000 gain. • Depreciation expense recorded on the equipment during the year was $65,000. Which of the following statements is correct with respect to determining cash flow from operating activities?

Which of the following would be subtracted from net income when determining cash flows from operating activities under the indirect method?

Atkins Corporation has provided the following information for the year ended December 31,2019: • The equipment account balance increased by $200,000 from the beginning of the year to the end of the year. • The equipment accumulated depreciation account balance increased by $35,000 from the beginning of the year to the end of the year. • Equipment costing $50,000 was sold during the year resulting in a $10,000 gain. • Depreciation expense recorded on the equipment during the year was $65,000. - Which of the following statements is correct with respect to determining cash flow from investing activities? Assume that the equipment purchase and sale resulted in cash flows.

A higher quality of income ratio implies that operations tend to be financed internally without having to rely on external financing sources.

When a company purchases equipment using common stock,the equipment purchase is reported as a financing activity.

Amanda Company reported income tax expense of $250,000.Beginning income taxes payable was $30,000,while ending income taxes payable was $25,000,and accounts payable decreased $10,000.How much cash was paid for taxes?