Question 1

The purchase of treasury stock is treated as a cash outflow in the ____________________ activities section of the statement of cash flows.

Accepted Answer

The answer of The purchase of treasury stock is treated...

Question 2

A corporation received $80,000 in cash when it sold common stock and used the proceeds to pay $60,000 in bonds payable.As a result,the statement of cash flows would report

Accepted Answer

A)  $20,000 as the net cash used in financing activities. 
B)  $20,000 as the net cash provided by investing activities. 
C)  $20,000 as the net cash used in investing activities. 
D)  $20,000 as the net cash provided by financing activities. 
A)  $20,000 as the net cash used in financing activities. 
B)  $20,000 as the net cash provided by investing activities. 
C)  $20,000 as the net cash used in investing activities. 
D)  $20,000 as the net cash provided by financing activities.

Question 3

On a statement of cash flows,an increase in a prepaid expense

Accepted Answer

A)  is included in computing cash flows from operating activities. 
B)  is included in computing cash flows from investing activities. 
C)  is included in computing cash flows from financing activities. 
D)  is not used in computing cash flows. 
A)  is included in computing cash flows from operating activities. 
B)  is included in computing cash flows from investing activities. 
C)  is included in computing cash flows from financing activities. 
D)  is not used in computing cash flows.

Question 4

The net cash provided by operating activities is affected by

Accepted Answer

A)  a change in merchandise inventory. 
B)  a purchase of land for cash. 
C)  the issue of bonds payable for cash. 
D)  proceeds of cash investments by stockholders. 
A)  a change in merchandise inventory. 
B)  a purchase of land for cash. 
C)  the issue of bonds payable for cash. 
D)  proceeds of cash investments by stockholders.

Question 5

In computing the cash flows from operating activities section,a loss on the sale of long-term assets must be deducted from net income.

Accepted Answer

A) True 
 B)False

Question 6

A list of sources and uses of cash are given below.Indicate on the line provided whether each is an (O)operating, (I)investing, (F)financing,or a significant (N)noncash financing and investing activity.

Accepted Answer

(a)O, (b)F, (c)I, (d

Question 7

List some examples of transactions or activities within a company that must be disclosed in the Statement of Cash Flows.

Accepted Answer

Cash payments for income taxes and cash

Question 8

On the statement of cash flows,cash and cash ____________________ consist of currency,bank accounts,and short-term,highly liquid investments.

Accepted Answer

The answer of On the statement of cash flows,cash and...

Question 9

When the net cash provided by operating activities is determined,a gain on a sale of equipment should

Accepted Answer

A)  be added to the net income. 
B)  be subtracted from the net income. 
C)  not be used in the calculation. 
D)  be reported in the cash flows from financing activities section. 
A)  be added to the net income. 
B)  be subtracted from the net income. 
C)  not be used in the calculation. 
D)  be reported in the cash flows from financing activities section.

Question 10

A complete set of published financial statements for a corporation must include a statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 11

Windwhirl Company,reported net income of $150,000 and a $5,000 gain on the sale of equipment.The cash received from the sale of equipment was $22,000.Windwhirl issued additional shares of stock for $225,000,paid off a $200,000 bond issue recorded at par and paid out $40,000 in dividends during the year.Calculate the increase or decrease in cash from financing activities.

Accepted Answer

A)  ($15,000). 
B)  $7,000. 
C)  $27,000. 
D)  $152,000. 
A)  ($15,000). 
B)  $7,000. 
C)  $27,000. 
D)  $152,000.

Question 12

If a firm's accounts receivable increased during the fiscal period,it is necessary to subtract the amount of the increase from the net income when computing the net cash provided by operating activities.

Accepted Answer

A) True 
 B)False

Question 13

When a firm issues a long-term note payable,the amount that it receives for the note is considered a cash inflow from operating activities.

Accepted Answer

A) True 
 B)False

Question 14

Cannon Manufacturing Co.sold equipment that cost $18,000 for $6,000.A loss on sale of $1,000 was recorded.How is the Cash Flows from Investing Activities affected?

Accepted Answer

A)  A cash inflow of $5,000 is recorded. 
B)  A cash inflow of $6,000 is recorded. 
C)  A cash inflow of $11,000 is recorded. 
D)  A cash inflow of $12,000 is recorded. 
A)  A cash inflow of $5,000 is recorded. 
B)  A cash inflow of $6,000 is recorded. 
C)  A cash inflow of $11,000 is recorded. 
D)  A cash inflow of $12,000 is recorded.

Question 15

Additional information:
Equipment costing $100,000 was sold for $70,000.Accumulated depreciation on this equipment was $20,000.
Dividends of $38,000 were declared and paid.
Bonds were issued at face value of $300,000.
Common stock of $55,000 was issued to acquire land.
Investments (stock in IBM)were purchased for $275,000.
Using the information provided,prepare the cash flows from financing activities for The Dolmen Company.

Accepted Answer

The answer of       ...

Question 16

Additional information:
Equipment costing $100,000 was sold for $70,000.Accumulated depreciation on this equipment was $20,000.
Dividends of $38,000 were declared and paid.
Bonds were issued at face value of $300,000.
Common stock of $55,000 was issued to acquire land.
Investments (stock in IBM)were purchased for $275,000.
Using the information provided,prepare the cash flows from operating activities for The Dolmen Company.

Accepted Answer

The answer of       ...

Question 17

Additional information:
Plant assets that originally cost $67,200 were sold for $56,400,resulting in a gain of $8,200.
Dividends of $35,815 were declared and paid.There were no dividends declared in 2015.
Using the information provided,prepare the cash flows from operating activities for The Kerfuffle Company using the indirect method.

Accepted Answer

The answer of       ...

Question 18

The payment of maturing bonds would be treated as a cash outflow in the ____________________ activities section of the statement of cash flows.

Accepted Answer

The answer of The payment of maturing bonds would be...

Question 19

Decreases in current assets must be deducted from net income to arrive at cash flows from operations.

Accepted Answer

A) True 
 B)False

Question 20

When the net cash provided by operating activities is determined,the amortization of bond premium

Accepted Answer

A)  should be added to the net income. 
B)  should be subtracted from the net income. 
C)  should not be used in the calculation. 
D)  be subtracted from the net cash amount after other calculations have been made. 
A)  should be added to the net income. 
B)  should be subtracted from the net income. 
C)  should not be used in the calculation. 
D)  be subtracted from the net cash amount after other calculations have been made.

Exam 24: The Statement of Cash Flows

The purchase of treasury stock is treated as a cash outflow in the ____________________ activities section of the statement of cash flows.

A corporation received $80,000 in cash when it sold common stock and used the proceeds to pay $60,000 in bonds payable.As a result,the statement of cash flows would report

On a statement of cash flows,an increase in a prepaid expense

The net cash provided by operating activities is affected by

In computing the cash flows from operating activities section,a loss on the sale of long-term assets must be deducted from net income.

A list of sources and uses of cash are given below.Indicate on the line provided whether each is an (O)operating, (I)investing, (F)financing,or a significant (N)noncash financing and investing activity.

List some examples of transactions or activities within a company that must be disclosed in the Statement of Cash Flows.

On the statement of cash flows,cash and cash ____________________ consist of currency,bank accounts,and short-term,highly liquid investments.

When the net cash provided by operating activities is determined,a gain on a sale of equipment should

A complete set of published financial statements for a corporation must include a statement of cash flows.

If a firm's accounts receivable increased during the fiscal period,it is necessary to subtract the amount of the increase from the net income when computing the net cash provided by operating activities.

When a firm issues a long-term note payable,the amount that it receives for the note is considered a cash inflow from operating activities.

Cannon Manufacturing Co.sold equipment that cost $18,000 for $6,000.A loss on sale of $1,000 was recorded.How is the Cash Flows from Investing Activities affected?

The payment of maturing bonds would be treated as a cash outflow in the ____________________ activities section of the statement of cash flows.

Decreases in current assets must be deducted from net income to arrive at cash flows from operations.

When the net cash provided by operating activities is determined,the amortization of bond premium

Accounting: the Language of Business

Analyzing Business Transactions

Analyzing Business Transactions Using T Accounts

The General Journal and the General Ledger

Adjustments and the Worksheet

Closing Entries and the Postclosing Trial Balance

Accounting for Sales and Accounts Receivable

Accounting for Purchases and Accounts Payable

Cash Receipts, Cash Payments, and Banking Procedures

Payroll Computations, Records, and Payment

Payroll Taxes, Deposits, and Reports

Accruals, Deferrals, and the Worksheet

Financial Statements and Closing Procedures

Accounting Principles and Reporting Standards

Accounts Receivable and Uncollectible Accounts

Notes Payable and Notes Receivable

Merchandise Inventory

Property, Plant, and Equipment

Accounting for Partnerships

Corporations: Formation and Capital Stock Transactions

Corporate Earnings and Capital Transactions

Long-Term Bonds

Financial Statement Analyses

Departmentalized Profit and Cost Centers

Accounting for Manufacturing Activities

Job Order Cost Accounting

Process Cost Accounting

Controlling Manufacturing Costs: Standard Costs

Cost-Revenue Analysis for Decision Making

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