Question 1

Which of the following financing activities results in a cash outflow?

Accepted Answer

A) purchase of long-term investments. 
B) collecting accounts receivable. 
C) payment of dividends. 
D) issuance of bonds. 
A) purchase of long-term investments. 
B) collecting accounts receivable. 
C) payment of dividends. 
D) issuance of bonds.

Question 2

The __________________ computes operating cash flows by adjusting each line on the income statement to reflect cash flows.

Accepted Answer

The answer of The __________________ computes operating cash flows by...

Question 3

If accounts payable have increased during a period,

Accepted Answer

A) revenues on an accrual basis are less than revenues on a cash basis. 
B) expenses on an accrual basis are less than expenses on a cash basis. 
C) expenses on an accrual basis are greater than expenses on a cash basis. 
D) expenses on an accrual basis are the same as expenses on a cash basis. 
A) revenues on an accrual basis are less than revenues on a cash basis. 
B) expenses on an accrual basis are less than expenses on a cash basis. 
C) expenses on an accrual basis are greater than expenses on a cash basis. 
D) expenses on an accrual basis are the same as expenses on a cash basis.

Question 4

The following transactions occurred last year at Jackson Inc.   Based solely on the above information,the net cash flows from financing activities for the year on the statement of cash flows would be

Accepted Answer

A) $31,000. 
B) $(59,000). 
C) $43,000. 
D) $379,000. 
A) $31,000. 
B) $(59,000). 
C) $43,000. 
D) $379,000.

Question 5

If an asset is sold at a gain,why is the gain deducted from net income when computing the net cash flows from operating activities under the indirect method?

Accepted Answer

The gain is deducted from net

Question 6

Which balance sheet accounts are affected by operating activities?

Accepted Answer

A) current assets and current liabilities. 
B) current assets and long-term assets. 
C) long-term assets and current liabilities. 
D) long-term liabilities and stockholders' equity. 
A) current assets and current liabilities. 
B) current assets and long-term assets. 
C) long-term assets and current liabilities. 
D) long-term liabilities and stockholders' equity.

Question 7

The Laurel Company reported the following data for last year:   Based solely on this information,the net cash flows from financing activities on the statement of cash flows would be

Accepted Answer

A) $2,000. 
B) $(30,000). 
C) $(60,000). 
D) $(8,000). 
A) $2,000. 
B) $(30,000). 
C) $(60,000). 
D) $(8,000).

Question 8

Total operating expenses on Harmon Company's income statement for last year totaled $370,000.During the year accrued liabilities increased by $18,000,and prepaid expenses increased by $25,000.Depreciation expense for the year was $45,000.Based on this information,operating expenses adjusted to cash basis under the direct method on the statement of cash flows would be

Accepted Answer

A) $318,000. 
B) $332,000. 
C) $422,000. 
D) $408,000. 
A) $318,000. 
B) $332,000. 
C) $422,000. 
D) $408,000.

Question 9

If a loss of $9,200 is incurred in selling (for cash)a patent having a book value of $80,000,the total amount reported in the cash flows from investing activities section of the statement of cash flows is

Accepted Answer

A) $70,800. 
B) $89,200. 
C) $9,200. 
D) $80,000. 
A) $70,800. 
B) $89,200. 
C) $9,200. 
D) $80,000.

Question 10

The sale of land for cash would be classified as a cash inflow from a financing activity.

Accepted Answer

A) True 
 B)False

Question 11

The statement of cash flows does not report the

Accepted Answer

A) sources of cash in the current period. 
B) uses of cash in the current period. 
C) amount of checks outstanding at the end of the period. 
D) change in the cash balance for the current period. 
A) sources of cash in the current period. 
B) uses of cash in the current period. 
C) amount of checks outstanding at the end of the period. 
D) change in the cash balance for the current period.

Question 12

In calculating net cash from operating activities using the indirect method,depreciation expense is

Accepted Answer

A) deducted from net income. 
B) added to net income. 
C) ignored because it does not affect income. 
D) ignored because it is included in the investing section. 
A) deducted from net income. 
B) added to net income. 
C) ignored because it does not affect income. 
D) ignored because it is included in the investing section.

Question 13

The following items were reported on the balance sheets and income statement for Collin Inc.:   How would the change in accounts receivable be reported in the operating activities section of the statement of cash flows using the indirect method?

Accepted Answer

A) As an addition to sales. 
B) As a deduction from sales. 
C) As an addition to net income. 
D) As a deduction from net income. 
A) As an addition to sales. 
B) As a deduction from sales. 
C) As an addition to net income. 
D) As a deduction from net income.

Question 14

The Prince Company reported net income of $260,000 for the current year.Depreciation recorded on buildings and equipment amounted to $90,000 for the year.Balances of the current asset and current liability accounts for 2011 and 2012 are as follows:
   Prepare the cash flows from operating activities section of the statement of cash flows using the indirect method.

Accepted Answer

The answer of The Prince Company reported net income of...

Question 15

When an investing or financing activity takes place without affecting cash it is referred to as _________________________.

Accepted Answer

noncash in

Question 16

When preparing a statement of cash flows using the indirect method,why is depreciation added back to net income within the operating activities section?

Accepted Answer

The indirect method begins with net inco

Question 17

The amount for "net cash from operating activities" will be different depending on if the direct method or the indirect method is used to construct the statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following transactions does not affect cash during a period?

Accepted Answer

A) Increase in amortization expense 
B) Payment of an accounts payable 
C) Issuance of bonds 
D) Purchase of a long-term investment 
A) Increase in amortization expense 
B) Payment of an accounts payable 
C) Issuance of bonds 
D) Purchase of a long-term investment

Question 19

The acquisition of land by issuing common stock is

Accepted Answer

A) only reported if the statement of cash flows is prepared using the direct method. 
B) a cash transaction that is reported in the investing section in the body of the statement of cash flows. 
C) a noncash transaction that is reported in the operating section in the body of the statement of cash flows. 
D) a noncash transaction that is disclosed in a supplementary schedule attached to the statement of cash flows. 
A) only reported if the statement of cash flows is prepared using the direct method. 
B) a cash transaction that is reported in the investing section in the body of the statement of cash flows. 
C) a noncash transaction that is reported in the operating section in the body of the statement of cash flows. 
D) a noncash transaction that is disclosed in a supplementary schedule attached to the statement of cash flows.

Question 20

Cash flow activities that include the cash effect of transactions that create revenues and expenses and thus enter into the determination of net income are classified as operating activities on the statement of cash flows.

Accepted Answer

A) True 
 B)False

Which of the following financing activities results in a cash outflow?

The __________________ computes operating cash flows by adjusting each line on the income statement to reflect cash flows.

If accounts payable have increased during a period,

The following transactions occurred last year at Jackson Inc. Based solely on the above information,the net cash flows from financing activities for the year on the statement of cash flows would be

If an asset is sold at a gain,why is the gain deducted from net income when computing the net cash flows from operating activities under the indirect method?

Which balance sheet accounts are affected by operating activities?

The Laurel Company reported the following data for last year: Based solely on this information,the net cash flows from financing activities on the statement of cash flows would be

If a loss of $9,200 is incurred in selling (for cash)a patent having a book value of $80,000,the total amount reported in the cash flows from investing activities section of the statement of cash flows is

The sale of land for cash would be classified as a cash inflow from a financing activity.

The statement of cash flows does not report the

In calculating net cash from operating activities using the indirect method,depreciation expense is

The following items were reported on the balance sheets and income statement for Collin Inc.: How would the change in accounts receivable be reported in the operating activities section of the statement of cash flows using the indirect method?

When an investing or financing activity takes place without affecting cash it is referred to as _________________________.

When preparing a statement of cash flows using the indirect method,why is depreciation added back to net income within the operating activities section?

The amount for "net cash from operating activities" will be different depending on if the direct method or the indirect method is used to construct the statement of cash flows.

Which of the following transactions does not affect cash during a period?

The acquisition of land by issuing common stock is

Cash flow activities that include the cash effect of transactions that create revenues and expenses and thus enter into the determination of net income are classified as operating activities on the statement of cash flows.

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing,and Inventory Management

Profit Planning

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Financial Statement Analysis

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Exam 15: Statement of Cash Flows

Which of the following financing activities results in a cash outflow?

The __________________ computes operating cash flows by adjusting each line on the income statement to reflect cash flows.

If accounts payable have increased during a period,

The following transactions occurred last year at Jackson Inc. Based solely on the above information,the net cash flows from financing activities for the year on the statement of cash flows would be

If an asset is sold at a gain,why is the gain deducted from net income when computing the net cash flows from operating activities under the indirect method?

Which balance sheet accounts are affected by operating activities?

The Laurel Company reported the following data for last year: Based solely on this information,the net cash flows from financing activities on the statement of cash flows would be

If a loss of $9,200 is incurred in selling (for cash)a patent having a book value of $80,000,the total amount reported in the cash flows from investing activities section of the statement of cash flows is

The sale of land for cash would be classified as a cash inflow from a financing activity.

The statement of cash flows does not report the

In calculating net cash from operating activities using the indirect method,depreciation expense is

The following items were reported on the balance sheets and income statement for Collin Inc.: How would the change in accounts receivable be reported in the operating activities section of the statement of cash flows using the indirect method?

When an investing or financing activity takes place without affecting cash it is referred to as _________________________.

When preparing a statement of cash flows using the indirect method,why is depreciation added back to net income within the operating activities section?

The amount for "net cash from operating activities" will be different depending on if the direct method or the indirect method is used to construct the statement of cash flows.

Which of the following transactions does not affect cash during a period?

The acquisition of land by issuing common stock is

Cash flow activities that include the cash effect of transactions that create revenues and expenses and thus enter into the determination of net income are classified as operating activities on the statement of cash flows.

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing,and Inventory Management

Profit Planning

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Financial Statement Analysis

Filters