Exam 17: Statement of Cash Flows

The net income reported on the income statement for the current year was $225,000. Depreciation recorded on plant assets was $38,000. Accounts receivable and inventories increased by $2,000 and $8,000, respectively. Prepaid expenses and accounts payable decreased by $1,000 and $11,000 respectively. How much cash was provided by operating activities?

If accounts payable have increased during a period,

The income statement of Falcone Company is shown below: Additional information: 1. Accounts receivable increased $400,000 during the year. 2. Inventory increased $250,000 during the year. 3. Prepaid expenses increased $200,000 during the year. 4. Accounts payable to merchandise suppliers increased $100,000 during the year. 5. Accrued expenses payable increased $160,000 during the year. Instructions Prepare the operating activities section of the statement of cash flows for the year ended December 31, 2010, for Falcone Company, using the direct method.

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

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

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

If a loss of $20,000 is incurred in selling (for cash) office equipment having a book value of $80,000, the total amount reported in the cash flows from investing activities section of the statement of cash flows is

A company had net income of $210,000. Depreciation expense is $26,000. During the year, Accounts Receivable and Inventory increased $15,000 and $40,000, respectively. Prepaid Expenses and Accounts Payable decreased $2,000 and $4,000, respectively. There was also a loss on the sale of equipment of $3,000. How much cash was provided by operating activities?

Cline Company issued common stock for proceeds of $372,000 during 2010. The company paid dividends of $66,000 and issued a long-term note payable for $90,000 in exchange for equipment during the year. The company also purchased treasury stock that had a cost of $14,000. The financing section of the statement of cash flows will report net cash inflows of

Which of the following would be added to net income using the indirect method?

On the statement of cash flows using the indirect method, patent amortization expense will

Operating expenses + an increase in prepaid expenses - a decrease in accrued expenses payable = cash payments for operating expenses.

Haden Inc. had cash sales of $300,000 and credit sales of $1,050,000. The accounts receivable balance increased $15,000 during the year. How much cash did Haden receive from its customers during the year?

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

Cost of goods sold for the year amounted to $130,000, and during the year, accounts payable ______________ by $8,000 and inventory ______________ by $7,000 resulting in cash paid to suppliers of $115,000.

Of the items below, the one that appears first on the statement of cash flows is

The use of a worksheet to prepare a statement of cash flows is optional.

The three accounts shown below appear in the general ledger of Glaus Corp. during 2010. Instructions From the postings in the accounts, indicate how the information is reported on a statement of cash flows using the indirect method. The loss on sale of equipment was $5,000. (Hint: Cost of equipment constructed is reported in the investing activities section as a decrease in cash of $58,000.)

Indicate where the event purchased land and a building with a mortgage would appear, if at all, on the indirect statement of cash flows.

Financing activities involve