Question 1

Distinguish among the three types of activities reported in the statement of cash flows
The three activities are:

Accepted Answer

Operating activities include the cash ef

Question 2

The sale of equipment at less than its book value is a(n) ______________ of cash that is reported in the ______________ activities section.

Accepted Answer

The answer of The sale of equipment at less than...

Question 3

In calculating cash flows from operating activities using the indirect method, a loss on the sale of equipment will appear as a(n)

Accepted Answer

A)  subtraction from net income. 
B)  addition to net income. 
C)  addition to cash flow from investing activities. 
D)  subtraction from cash flow from investing activities. 
A)  subtraction from net income. 
B)  addition to net income. 
C)  addition to cash flow from investing activities. 
D)  subtraction from cash flow from investing activities.

Question 4

In developing the cash flows from operating activities, most companies in the U. S.

Accepted Answer

A)  use the direct method. 
B)  use the indirect method. 
C)  present both the indirect and direct methods in their financial reports. 
D)  prepare the operating activities section on the accrual basis. 
A)  use the direct method. 
B)  use the indirect method. 
C)  present both the indirect and direct methods in their financial reports. 
D)  prepare the operating activities section on the accrual basis.

Question 5

A statement of cash flows should help investors and creditors assess the entity's ability to generate future income.

Accepted Answer

A) True 
 B)False

Question 6

Cash provided by operations is generally equal to operating income.

Accepted Answer

A) True 
 B)False

Question 7

Clare Company had total operating expenses of $185,000 in 2017, which included Depreciation Expense of $36,000. Also, during 2017, prepaid expenses increased by $8,000 and accrued expenses decreased by $7,600.
Instructions
Calculate the amount of cash payments for operating expenses in 2017 using the direct method.

Accepted Answer

The answer of Clare Company had total operating expenses of...

Question 8

If a company has both an inflow and outflow of cash related to property, plant, and equipment, the

Accepted Answer

A)  two cash effects can be netted and presented as one item in the investing activities section. 
B)  cash inflow and cash outflow should be reported separately in the investing activities section. 
C)  two cash effects can be netted and presented as one item in the financing activities section. 
D)  cash inflow and cash outflow should be reported separately in the financing activities section. 
A)  two cash effects can be netted and presented as one item in the investing activities section. 
B)  cash inflow and cash outflow should be reported separately in the investing activities section. 
C)  two cash effects can be netted and presented as one item in the financing activities section. 
D)  cash inflow and cash outflow should be reported separately in the financing activities section.

Question 9

Hogan Company uses the direct method in determining net cash provided by operating activities, During the year, operating expenses were $295,000, prepaid expenses increased $23,000, and accrued expenses payable increased $33,000. Cash payments for operating expenses were

Accepted Answer

A)  $39,000. 
B)  $51,000. 
C)  $305,000. 
D)  $285,000. 
A)  $39,000. 
B)  $51,000. 
C)  $305,000. 
D)  $285,000.

Question 10

Marke Inc. had cash sales of $400,000 and credit sales of $1,150,000. The accounts receivable balance increased $30,000 during the year. How much cash did Hark receive from its customers during the year?

Accepted Answer

A)  $1,520,000 
B)  $1,120,000 
C)  $1,550,000 
D)  $780,000 
A)  $1,520,000 
B)  $1,120,000 
C)  $1,550,000 
D)  $780,000

Question 11

The statement of cash flows reports each of the following except

Accepted Answer

A)  cash receipts from operating activities. 
B)  cash payments from investing activities. 
C)  the net change in cash. 
D)  cash sales. 
A)  cash receipts from operating activities. 
B)  cash payments from investing activities. 
C)  the net change in cash. 
D)  cash sales.

Question 12

For external reporting, a company must prepare either an income statement or a statement of cash flows, but not both.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following would not be needed to determine net cash provided by operating activities?

Accepted Answer

A)  Depreciation expense 
B)  Change in accounts receivable 
C)  Payment of cash dividends 
D)  Change in prepaid expenses 
A)  Depreciation expense 
B)  Change in accounts receivable 
C)  Payment of cash dividends 
D)  Change in prepaid expenses

Question 14

If accounts receivable have increased during the period,

Accepted Answer

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

Question 15

In the Garnet Company, the beginning and ending balances in Land were $198,000 and $240,000 respectively. During the year, land costing $50,000 was sold for $50,000 cash, and land costing $92,000 was purchased for cash. The entries in the reconciling columns of the worksheet will include a:

Accepted Answer

A)  credit to Land $50,000 and a debit to Sale of Land $50,000 under investing activities. 
B)  debit to Land $92,000 and a credit to Purchase of Land $92,000 under financing activities. 
C)  net debit to Land $42,000 and a credit to Purchase of Land $42,000 under investing activities. 
D)  credit to Land $50,000 and a debit to Sale of Land $50,000 under financing activities. 
A)  credit to Land $50,000 and a debit to Sale of Land $50,000 under investing activities. 
B)  debit to Land $92,000 and a credit to Purchase of Land $92,000 under financing activities. 
C)  net debit to Land $42,000 and a credit to Purchase of Land $42,000 under investing activities. 
D)  credit to Land $50,000 and a debit to Sale of Land $50,000 under financing activities.

Question 16

Show Company had total operating expenses of $153,000 in 2017, which included Depreciation Expense of $30,000. Also during 2017, prepaid expenses decreased by $9,500 and accrued expenses increased by $8,500.
Instructions
Calculate the amount of cash payments for operating expenses in 2017 using the direct method.

Accepted Answer

The answer of Show Company had total operating expenses of...

Question 17

The current sections of Donny Inc.'s balance sheets at December 31, 2016 and 2017, are presented here.
Donny's net income for 2017 was $203,000. Depreciation expense was $25,000.   Instructions
Prepare the net cash provided by operating activities section of the company's statement of cash flows for the year ended December 31, 2017, using the indirect method.

Accepted Answer

The answer of The current sections of Donny Inc.'s balance...

Question 18

Which of the following adjustments to convert net income to net cash provided by operating activities is incorrect?

Accepted Answer

The answer of Which of the following adjustments to convert...

Question 19

During 2017, Zuma Company had $150,000 in cash sales and $1,240,000 in credit sales. The accounts receivable balances were $180,000 and $215,000 at December 31, 2016 and 2017, respectively. Using the direct method of reporting cash flows from operating activities, what was the total cash collected from all customers during 2017?

Accepted Answer

A)  $1,205,000 
B)  $1,425,000 
C)  $1,390,000 
D)  $1,355,000 
A)  $1,205,000 
B)  $1,425,000 
C)  $1,390,000 
D)  $1,355,000

Question 20

A primary objective of the statement of cash flows is to show the income or loss on investing and financing transactions.

Accepted Answer

A) True 
 B)False

Distinguish among the three types of activities reported in the statement of cash flows The three activities are:

The sale of equipment at less than its book value is a(n) of cash that is reported in the activities section.

In calculating cash flows from operating activities using the indirect method, a loss on the sale of equipment will appear as a(n)

In developing the cash flows from operating activities, most companies in the U. S.

A statement of cash flows should help investors and creditors assess the entity's ability to generate future income.

Cash provided by operations is generally equal to operating income.

If a company has both an inflow and outflow of cash related to property, plant, and equipment, the

Hogan Company uses the direct method in determining net cash provided by operating activities, During the year, operating expenses were $295,000, prepaid expenses increased $23,000, and accrued expenses payable increased $33,000. Cash payments for operating expenses were

Marke Inc. had cash sales of $400,000 and credit sales of $1,150,000. The accounts receivable balance increased $30,000 during the year. How much cash did Hark receive from its customers during the year?

The statement of cash flows reports each of the following except

For external reporting, a company must prepare either an income statement or a statement of cash flows, but not both.

Which of the following would not be needed to determine net cash provided by operating activities?

If accounts receivable have increased during the period,

In the Garnet Company, the beginning and ending balances in Land were $198,000 and $240,000 respectively. During the year, land costing $50,000 was sold for $50,000 cash, and land costing $92,000 was purchased for cash. The entries in the reconciling columns of the worksheet will include a:

Which of the following adjustments to convert net income to net cash provided by operating activities is incorrect?

A primary objective of the statement of cash flows is to show the income or loss on investing and financing transactions.

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions

Financial Statement Analysis

Specimen Financial Statements: Apple Inc

Specimen Financial Statements: Pepsico, Inc

Specimen Financial Statements: the Coca-Cola Company

Specimen Financial Statements: Amazoncom, Inc

Specimen Financial Statements: Wal-Mart Stores, Inc

Filters

Exam 12: Statement of Cash Flows

Distinguish among the three types of activities reported in the statement of cash flows The three activities are:

The sale of equipment at less than its book value is a(n) ______________ of cash that is reported in the ______________ activities section.

In calculating cash flows from operating activities using the indirect method, a loss on the sale of equipment will appear as a(n)

In developing the cash flows from operating activities, most companies in the U. S.

A statement of cash flows should help investors and creditors assess the entity's ability to generate future income.

Cash provided by operations is generally equal to operating income.

If a company has both an inflow and outflow of cash related to property, plant, and equipment, the

Hogan Company uses the direct method in determining net cash provided by operating activities, During the year, operating expenses were $295,000, prepaid expenses increased $23,000, and accrued expenses payable increased $33,000. Cash payments for operating expenses were

Marke Inc. had cash sales of $400,000 and credit sales of $1,150,000. The accounts receivable balance increased $30,000 during the year. How much cash did Hark receive from its customers during the year?

The statement of cash flows reports each of the following except

For external reporting, a company must prepare either an income statement or a statement of cash flows, but not both.

Which of the following would not be needed to determine net cash provided by operating activities?

If accounts receivable have increased during the period,

In the Garnet Company, the beginning and ending balances in Land were $198,000 and $240,000 respectively. During the year, land costing $50,000 was sold for $50,000 cash, and land costing $92,000 was purchased for cash. The entries in the reconciling columns of the worksheet will include a:

Which of the following adjustments to convert net income to net cash provided by operating activities is incorrect?

A primary objective of the statement of cash flows is to show the income or loss on investing and financing transactions.

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions

Financial Statement Analysis

Specimen Financial Statements: Apple Inc

Specimen Financial Statements: Pepsico, Inc

Specimen Financial Statements: the Coca-Cola Company

Specimen Financial Statements: Amazoncom, Inc

Specimen Financial Statements: Wal-Mart Stores, Inc

Filters

The sale of equipment at less than its book value is a(n) of cash that is reported in the activities section.