Question 1

The statement of cash flows will not report the

Accepted Answer

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

Question 2

Each of the following is an example of a significant noncash activity except

Accepted Answer

A) conversion of bonds into common stock. 
B) exchanges of plant assets. 
C) issuance of debt to purchase assets. 
D) stock dividends. 
A) conversion of bonds into common stock. 
B) exchanges of plant assets. 
C) issuance of debt to purchase assets. 
D) stock dividends.

Question 3

Which of the following transactions would not be classified as a financing activity?

Accepted Answer

A) Purchase of treasury stock 
B) Payment of dividends 
C) Issuance of bonds at a discount 
D) Purchase of a long-term investment in bonds 
A) Purchase of treasury stock 
B) Payment of dividends 
C) Issuance of bonds at a discount 
D) Purchase of a long-term investment in bonds

Question 4

Financing activities involve

Accepted Answer

A) lending money to other entities and collecting on those loans. 
B) cash receipts from sales of goods and services. 
C) acquiring and disposing of productive long-lived assets. 
D) long-term liability and stockholders' equity items. 
A) lending money to other entities and collecting on those loans. 
B) cash receipts from sales of goods and services. 
C) acquiring and disposing of productive long-lived assets. 
D) long-term liability and stockholders' equity items.

Question 5

In preparing net cash flow from operating activities using the direct method, each item in the income statement is adjusted from the accrual basis to the cash basis.

Accepted Answer

A) True 
 B)False

Question 6

During 2015, 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, 2014 and 2015, respectively. Using the direct method of reporting cash flows from operating activities, what was the total cash collected from all customers during 2015?

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 7

Pare Company reported a net loss of $30,000 for the year ended December 31, 2014. During the year, accounts receivable decreased $15,000, merchandise inventory increased $25,000, accounts payable increased by $30,000, and depreciation expense of $20,000 was recorded. During 2014, operating activities

Accepted Answer

A) used net cash of $10,000. 
B) used net cash of $25,000. 
C) provided net cash of $10,000. 
D) provided net cash of $25,000. 
A) used net cash of $10,000. 
B) used net cash of $25,000. 
C) provided net cash of $10,000. 
D) provided net cash of $25,000.

Question 8

The following data are available for Alamo Corporation.   Net cash provided by investing activities is:

Accepted Answer

A) $285,000. 
B) $260,000. 
C) $305,000. 
D) $425,000. 
A) $285,000. 
B) $260,000. 
C) $305,000. 
D) $425,000.

Question 9

Indicate where the payment of income taxes would appear, if at all, on the statement of cash flows.

Accepted Answer

A) Operating activities section 
B) Investing activities section 
C) Financing activities section 
D) Does not represent a cash flow 
A) Operating activities section 
B) Investing activities section 
C) Financing activities section 
D) Does not represent a cash flow

Question 10

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

Accepted Answer

A) Write-off of an uncollectible account 
B) Collection of an accounts receivable 
C) Sale of treasury stock 
D) Exercise of the call option on bonds payable 
A) Write-off of an uncollectible account 
B) Collection of an accounts receivable 
C) Sale of treasury stock 
D) Exercise of the call option on bonds payable

Question 11

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 12

Accounts receivable arising from sales to customers amounted to $86,000 and $77,000 at the beginning and end of the year, respectively. Income reported on the income statement for the year was $290,000. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows is

Accepted Answer

A) $290,000. 
B) $299,000. 
C) $213,000. 
D) $280,000. 
A) $290,000. 
B) $299,000. 
C) $213,000. 
D) $280,000.

Question 13

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 14

Land acquired from the issuance of common stock is reported

Accepted Answer

A) as a financing activity. 
B) as an investing activity. 
C) as an operating activity. 
D) in a separate schedule at the bottom of the statement of cash flows. 
A) as a financing activity. 
B) as an investing activity. 
C) as an operating activity. 
D) in a separate schedule at the bottom of the statement of cash flows.

Question 15

Using the indirect method, if equipment is sold at a gain, the

Accepted Answer

A) sale proceeds received are deducted in the operating activities section. 
B) sale proceeds received are added in the operating activities section. 
C) amount of the gain is added in the operating activities section. 
D) amount of the gain is deducted in the operating activities section. 
A) sale proceeds received are deducted in the operating activities section. 
B) sale proceeds received are added in the operating activities section. 
C) amount of the gain is added in the operating activities section. 
D) amount of the gain is deducted in the operating activities section.

Question 16

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 17

Any item that appears on the income statement would be considered as either a cash inflow or cash outflow from operating activities.

Accepted Answer

A) True 
 B)False

Question 18

The following data are available for Two-off Company.   Net cash provided by financing activities is:

Accepted Answer

A) $180,000. 
B) $370,000. 
C) $360,000. 
D) $420,000. 
A) $180,000. 
B) $370,000. 
C) $360,000. 
D) $420,000.

Question 19

Rubble Company reported net income of $70,000 for the year. During the year, accounts receivable increased by $6,000, accounts payable decreased by $5,000 and depreciation expense of $8,000 was recorded. Net cash provided by operating activities for the year is

Accepted Answer

A) $67,000. 
B) $89,000. 
C) $63,000. 
D) $70,000. 
A) $67,000. 
B) $89,000. 
C) $63,000. 
D) $70,000.

Question 20

Ale Company reports a $16,000 increase in inventory and a $8,000 increase in accounts payable during the year. Cost of Goods Sold for the year was $150,000. The cash payments made to suppliers were

Accepted Answer

A) $150,000. 
B) $158,000. 
C) $126,000. 
D) $174,000. 
A) $150,000. 
B) $158,000. 
C) $126,000. 
D) $174,000.

The statement of cash flows will not report the

Each of the following is an example of a significant noncash activity except

Which of the following transactions would not be classified as a financing activity?

Financing activities involve

In preparing net cash flow from operating activities using the direct method, each item in the income statement is adjusted from the accrual basis to the cash basis.

The following data are available for Alamo Corporation. Net cash provided by investing activities is:

Indicate where the payment of income taxes would appear, if at all, on the statement of cash flows.

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

If accounts receivable have increased during the period,

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

Land acquired from the issuance of common stock is reported

Using the indirect method, if equipment is sold at a gain, the

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

Any item that appears on the income statement would be considered as either a cash inflow or cash outflow from operating activities.

The following data are available for Two-off Company. Net cash provided by financing activities is:

Rubble Company reported net income of $70,000 for the year. During the year, accounts receivable increased by $6,000, accounts payable decreased by $5,000 and depreciation expense of $8,000 was recorded. Net cash provided by operating activities for the year is

Ale Company reports a $16,000 increase in inventory and a $8,000 increase in accounts payable during the year. Cost of Goods Sold for the year was $150,000. The cash payments made to suppliers were

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, Dividends, and Retained Earnings

Investments

Financial Statement Analysis

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Exam 13: Statement of Cash Flows

The statement of cash flows will not report the

Each of the following is an example of a significant noncash activity except

Which of the following transactions would not be classified as a financing activity?

Financing activities involve

In preparing net cash flow from operating activities using the direct method, each item in the income statement is adjusted from the accrual basis to the cash basis.

The following data are available for Alamo Corporation. Net cash provided by investing activities is:

Indicate where the payment of income taxes would appear, if at all, on the statement of cash flows.

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

If accounts receivable have increased during the period,

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

Land acquired from the issuance of common stock is reported

Using the indirect method, if equipment is sold at a gain, the

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

Any item that appears on the income statement would be considered as either a cash inflow or cash outflow from operating activities.

The following data are available for Two-off Company. Net cash provided by financing activities is:

Rubble Company reported net income of $70,000 for the year. During the year, accounts receivable increased by $6,000, accounts payable decreased by $5,000 and depreciation expense of $8,000 was recorded. Net cash provided by operating activities for the year is

Ale Company reports a $16,000 increase in inventory and a $8,000 increase in accounts payable during the year. Cost of Goods Sold for the year was $150,000. The cash payments made to suppliers were

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, Dividends, and Retained Earnings

Investments

Financial Statement Analysis

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