Exam 12: Statement of Cash Flows

Instructions Show how each item should be reported in the statement of cash flows. Use parentheses for deductions.

Each of the following is added to net income in computing net cash provided by operating activities except

The following information is available for Redcands Company: Receipts from customers \ 215,000 Dividends from stock investments 3,000 Proceeds from sale of equipment 18,000 Proceeds from issuance of stock 90,000 Payments for inventory 100,000 Payments for operating expenses 78,000 Interest paid 6,000 Taxes paid 4,000 Dividends paid 20,000 Instructions Based on the preceding information, compute the net cash provided by operating activities.

Free cash flow equals cash provided by operations less capital expenditures and cash dividends.

Miroz Corporation's comparative balance sheets are presented below. MIROZ CORPORATION Comparative Balance Sheets Additional information: 1. Net income was $17,700. Dividends declared and paid were $9,300. 2. Equipment which cost $11,000 and had accumulated depreciation of $2,000 was sold for $4,000. 3. All other changes in noncurrent account balances had a direct effect on cash flows, except the change in accumulated depreciation. Instruction (a) Prepare a statement of cash flows for 2017 using the indirect method. (b) Compute free cash flow.

Under the direct method, noncash charges, such as depreciation, are _______________ in the statement of cash flows.

In Alona Company, net income is $285,000. If accounts receivable increased $140,000 and accounts payable decreased $40,000, net cash provided by operating activities using the indirect method is:

If accounts receivable increase during a period, revenues on an accrual basis are ______________ than revenues on a cash basis.

Vision Company purchased treasury stock with a cost of $16,000 during 2017. During the year, the company paid dividends of $20,000 and issued bonds payable for proceeds of $860,000. Cash flows from financing activities for 2017 total

Madisun Company issued common stock for proceeds of $20,000 during 2017. The company paid dividends of $5,000. The company also issued a long-term note payable for $35,000 in exchange for equipment during the year. The company sold treasury stock that had a cost of $3,000 for $9,000. Instructions Compute net cash flows from financing activities.

Which one of the following items is not necessary in preparing a statement of cash flows?

Tomas Pest Control Products has the following information available: Net Income \ 25,000 Cash Provided by Operations 33,000 Cash Sales 65,000 Capital Expenditures 10,000 Dividends Paid 2,000 What is Tomas' free cash flow?

During the year, Income Tax Expense amounted to $30,000 and Income Taxes Payable increased by $4,000; therefore, the cash paid for income taxes was $26,000.

The statement of cash flows will not provide insight into

In preparing a statement of cash flows, the issuance of debt should be reported separately from the retirement of debt.

All major financing and investing activities affect cash.

If $250,000 of bonds are issued during the year but $130,000 of old bonds are retired during the year, the statement of cash flows will show a(n)

The statement of cash flows is a required statement that must be prepared along with an income statement, balance sheet, and retained earnings statement.

Under the direct method, the formula for computing cash collections from customers is sales revenues plus the increase in accounts receivable or minus the decrease in accounts receivable.

Christine Company had an increase in inventory of $55,000. The cost of goods sold was $95,000. There was a $6,000 decrease in accounts payable from the prior period. What were Thomas' cash payments to suppliers?