Exam 17: Statement of Cash Flows

Miroz Corporation's comparative balance sheets are presented below. MIROZ CORPORATION Comparative Balance Sheets December 31 Cash \ 18,700 \ 22,700 Accounts receivable 24,700 22,300 Investments 25,000 16,000 Equipment 59,000 70,000 Accumulated depreciation Total Accounts payable \ 13,600 \ 11,100 Bonds payable 6,000 30,000 Common stock 50,000 45,000 Retained earnings Total \ 112,900 \ 121,000 Additional information: 1. Net income was $17700. Dividends declared and paid were $9300. 2. Equipment which cost $11000 and had accumulated depreciation of $2000 was sold for $4000. 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.

The reconciling entry for depreciation expense in a worksheet is a credit to Accumulated Depreciation and a debit to Operating-Depreciation Expense.

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

Analysis of the changes in all of the noncash balance sheet accounts will explain the change in the Cash account.

A company had net income of $210000. Depreciation expense is $27000. During the year Accounts Receivable and Inventory increased $17000 and $42000 respectively. Prepaid Expenses and Accounts Payable decreased $5000 and $6000 respectively. There was also a loss on the sale of equipment of $2000. How much cash was provided by operating activities?

Which of the following adjustments to convert net income to net cash provided by operating activities is not added to net income?

In the Garnet Company the beginning and ending balances in Land were $198000 and $240000 respectively. During the year land costing $50000 was sold for $50000 cash and land costing $92000 was purchased for cash. The entries in the reconciling columns of the worksheet will include a:

The category that is generally considered to be the best measure of a company's ability to continue as a going concern is

The net income reported on the income statement for the current year was $220000. Depreciation recorded on plant assets was $35000. Accounts receivable and inventories increased by $2000 and $8000 respectively. Prepaid expenses and accounts payable decreased by $2000 and $12000 respectively. How much cash was provided by operating activities?

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

The information to prepare the statement of cash flows usually comes from each of the following except

Free cash flow equals cash provided by

Beane Corporation shows income tax expense of $82000. There has been a $6000 decrease in federal income taxes payable and a $7000 increase in state income taxes payable during the year. What was Beane's cash payment for income taxes?

Kanet Company issued common stock for proceeds of $386000 during 2016. The company paid dividends of $80000 and issued a long-term note payable for $95000 in exchange for equipment during the year. The company also purchased treasury stock that had a cost of $15000. The financing section of the statement of cash flows will report net cash inflows of

The acquisition of a building by issuing bonds would be considered an investing and financing activity that did not affect cash.

In preparing the statement of cash flows determining the net increase or decrease in cash requires the use of

Ale Company has other operating expenses of $80000. There has been a decrease in prepaid expenses of $6000 during the year and accrued liabilities are $5000 larger than in the prior period. What were Ale's cash payments for operating expenses?

In Lynne Company there was an increase in the land account during the year of $43000. Analysis reveals that the change resulted from a cash sale of land at cost $115000 and a cash purchase of land for $158000. In the statement of cash flows the change in the land account should be reported in the investment section:

Under the direct method the two largest classes of items in the operating activities section for a merchandising company are cash ________________________ and cash _________________________.

On the statement of cash flows worksheet