Question 1

Investing activities affect non-current asset accounts.

Accepted Answer

A) True 
 B)False

Question 2

During the year, Kawartha Corp.reported an increase in Inventory of $40,000.Cost of Goods Sold for the year was $125,000, and there was an $6,000 decrease in Accounts Payable.What were the cash payments to suppliers during the year?

Accepted Answer

A) $79,000 
B) $91,000 
C) $159,000 
D) $171,000 
A) $79,000 
B) $91,000 
C) $159,000 
D) $171,000

Question 3

The acquisition of land by issuing common shares is

Accepted Answer

A) a cash transaction and would be reported in the body of a statement of cash flows. 
B) a noncash transaction that is not reported in the body of a statement of cash flows. 
C) a noncash transaction but would be reported in the body of a statement of cash flows. 
D) only reported if the statement of cash flows is prepared using the direct method. 
A) a cash transaction and would be reported in the body of a statement of cash flows. 
B) a noncash transaction that is not reported in the body of a statement of cash flows. 
C) a noncash transaction but would be reported in the body of a statement of cash flows. 
D) only reported if the statement of cash flows is prepared using the direct method.

Question 4

During the year, Rinks Corp.reported $510,000 in cash sales and $2,350,000 in credit sales.Beginning Accounts Receivable was $360,000 and ending Accounts Receivable was $475,000.What was the total cash collected from all customers during the year?

Accepted Answer

A) $3,695,000 
B) $2,975,000 
C) $2,675,000 
D) $2,745,000 
A) $3,695,000 
B) $2,975,000 
C) $2,675,000 
D) $2,745,000

Question 5

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

Accepted Answer

A) write-off of an uncollectible account receivable 
B) collection of an account receivable 
C) sale of common shares 
D) repayment of a bank loan 
A) write-off of an uncollectible account receivable 
B) collection of an account receivable 
C) sale of common shares 
D) repayment of a bank loan

Question 6

Which of the following is not an adjustment applied to net income to arrive at net cash provided or used by operating activities under the indirect method?

Accepted Answer

A) add back losses. 
B) add back noncash expenses. 
C) add increases in current assets. 
D) deduct decreases in current liabilities. 
A) add back losses. 
B) add back noncash expenses. 
C) add increases in current assets. 
D) deduct decreases in current liabilities.

Question 7

Cash flows provided (used) by operating activities, prepared using the indirect method, would include

Accepted Answer

A) receipts from the sale of investments. 
B) net income. 
C) payments for dividends. 
D) receipts from the issue of preferred shares. 
A) receipts from the sale of investments. 
B) net income. 
C) payments for dividends. 
D) receipts from the issue of preferred shares.

Question 8

In which section would the purchase of land for cash be classified 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 9

Use the following information for questions 
Boreal Corporation is a private corporation reporting under ASPE and uses the indirect method when preparing its statement of cash flows.The company has engaged in the following transactions.For each transaction, indicate where it would be reflected on the statement of cash flows.
-An increase in inventory from year one to year two:

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

Use the following information for questions 
Ingles Corp., a private company reporting under ASPE, engaged in the following transactions.For each transaction, indicate where, if at all, it would be classified on the statement of cash flows.
-Issue of preferred shares for cash:

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 11

Cash equivalents can include both short-term and long-term investments.

Accepted Answer

A) True 
 B)False

Question 12

Under the direct method, as an adjustment to operating expenses per the statement of income, a decrease in prepaid expenses would be added to operating expenses to determine cash payments for operating expenses.

Accepted Answer

A) True 
 B)False

Question 13

Use the following information for questions 
Boreal Corporation is a private corporation reporting under ASPE and uses the indirect method when preparing its statement of cash flows.The company has engaged in the following transactions.For each transaction, indicate where it would be reflected on the statement of cash flows.
-A decrease in accounts receivable from year one to year two:

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 14

If a company has both a receipt and payment of cash related to the acquisition of equipment for $15,000 cash and the sale of machinery for $10,000 cash, the

Accepted Answer

A) two cash effects can be netted and presented as one item in investing activities. 
B) cash receipt from the sale and cash payment for the acquisition should be reported separately in investing activities. 
C) two cash effects can be netted and presented as one item in financing activities. 
D) cash receipt and cash payment should be reported separately in financing activities. 
A) two cash effects can be netted and presented as one item in investing activities. 
B) cash receipt from the sale and cash payment for the acquisition should be reported separately in investing activities. 
C) two cash effects can be netted and presented as one item in financing activities. 
D) cash receipt and cash payment should be reported separately in financing activities.

Question 15

Under IFRS, the receipt of dividends from equity investments may be classified as a cash receipt provided (used) by investing activities.

Accepted Answer

A) True 
 B)False

Question 16

On a statement of cash flows using the indirect method, depreciation expense will

Accepted Answer

A) be added to net income in the operating activities section. 
B) be deducted from net income in the operating activities section. 
C) appear a cash receipt in the investing activities section. 
D) be ignored. 
A) be added to net income in the operating activities section. 
B) be deducted from net income in the operating activities section. 
C) appear a cash receipt in the investing activities section. 
D) be ignored.

Question 17

Under the direct method, one of the adjustments to revenue to determine cash receipts from customers is made by

Accepted Answer

A) deducting a decrease in accounts receivables. 
B) adding an increase in accounts receivables. 
C) adding a decrease in deferred revenue 
D) deducting a decrease in deferred revenue. 
A) deducting a decrease in accounts receivables. 
B) adding an increase in accounts receivables. 
C) adding a decrease in deferred revenue 
D) deducting a decrease in deferred revenue.

Question 18

Noncash investing and financing activities must be reported in the body of a statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following items affecting retained earnings during a period could be reported in the financing activities section of the statement of cash flows?

Accepted Answer

A) cash dividends paid only 
B) net income for the period only 
C) both cash dividends paid and net income for the period 
D) neither cash dividends paid nor net income for the period 
A) cash dividends paid only 
B) net income for the period only 
C) both cash dividends paid and net income for the period 
D) neither cash dividends paid nor net income for the period

Question 20

If a loss of $20,000 is incurred in selling (for cash) office equipment that cost $90,000 and had accumulated depreciation of $22,500, then the actual cash proceeds must have been

Accepted Answer

A) $47,500. 
B) $67,500. 
C) $70,000. 
D) $87,500. 
A) $47,500. 
B) $67,500. 
C) $70,000. 
D) $87,500.

Investing activities affect non-current asset accounts.

During the year, Kawartha Corp.reported an increase in Inventory of $40,000.Cost of Goods Sold for the year was $125,000, and there was an $6,000 decrease in Accounts Payable.What were the cash payments to suppliers during the year?

The acquisition of land by issuing common shares is

During the year, Rinks Corp.reported $510,000 in cash sales and $2,350,000 in credit sales.Beginning Accounts Receivable was $360,000 and ending Accounts Receivable was $475,000.What was the total cash collected from all customers during the year?

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

Which of the following is not an adjustment applied to net income to arrive at net cash provided or used by operating activities under the indirect method?

Cash flows provided (used) by operating activities, prepared using the indirect method, would include

In which section would the purchase of land for cash be classified on the statement of cash flows?

Use the following information for questions Ingles Corp., a private company reporting under ASPE, engaged in the following transactions.For each transaction, indicate where, if at all, it would be classified on the statement of cash flows. -Issue of preferred shares for cash:

Cash equivalents can include both short-term and long-term investments.

Under the direct method, as an adjustment to operating expenses per the statement of income, a decrease in prepaid expenses would be added to operating expenses to determine cash payments for operating expenses.

If a company has both a receipt and payment of cash related to the acquisition of equipment for $15,000 cash and the sale of machinery for $10,000 cash, the

Under IFRS, the receipt of dividends from equity investments may be classified as a cash receipt provided (used) by investing activities.

On a statement of cash flows using the indirect method, depreciation expense will

Under the direct method, one of the adjustments to revenue to determine cash receipts from customers is made by

Noncash investing and financing activities must be reported in the body of a statement of cash flows.

Which of the following items affecting retained earnings during a period could be reported in the financing activities section of the statement of cash flows?

If a loss of $20,000 is incurred in selling (for cash) office equipment that cost $90,000 and had accumulated depreciation of $22,500, then the actual cash proceeds must have been

The Purpose and Use of Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations

Reporting and Analyzing Inventory

Internal Control and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Shareholders Equity

Reporting and Analyzing Investments

Performance Measurement

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Exam 13: Statement of Cash Flows

Investing activities affect non-current asset accounts.

During the year, Kawartha Corp.reported an increase in Inventory of $40,000.Cost of Goods Sold for the year was $125,000, and there was an $6,000 decrease in Accounts Payable.What were the cash payments to suppliers during the year?

The acquisition of land by issuing common shares is

During the year, Rinks Corp.reported $510,000 in cash sales and $2,350,000 in credit sales.Beginning Accounts Receivable was $360,000 and ending Accounts Receivable was $475,000.What was the total cash collected from all customers during the year?

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

Which of the following is not an adjustment applied to net income to arrive at net cash provided or used by operating activities under the indirect method?

Cash flows provided (used) by operating activities, prepared using the indirect method, would include

In which section would the purchase of land for cash be classified on the statement of cash flows?

Use the following information for questions Ingles Corp., a private company reporting under ASPE, engaged in the following transactions.For each transaction, indicate where, if at all, it would be classified on the statement of cash flows. -Issue of preferred shares for cash:

Cash equivalents can include both short-term and long-term investments.

Under the direct method, as an adjustment to operating expenses per the statement of income, a decrease in prepaid expenses would be added to operating expenses to determine cash payments for operating expenses.

If a company has both a receipt and payment of cash related to the acquisition of equipment for $15,000 cash and the sale of machinery for $10,000 cash, the

Under IFRS, the receipt of dividends from equity investments may be classified as a cash receipt provided (used) by investing activities.

On a statement of cash flows using the indirect method, depreciation expense will

Under the direct method, one of the adjustments to revenue to determine cash receipts from customers is made by

Noncash investing and financing activities must be reported in the body of a statement of cash flows.

Which of the following items affecting retained earnings during a period could be reported in the financing activities section of the statement of cash flows?

If a loss of $20,000 is incurred in selling (for cash) office equipment that cost $90,000 and had accumulated depreciation of $22,500, then the actual cash proceeds must have been

The Purpose and Use of Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations

Reporting and Analyzing Inventory

Internal Control and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Shareholders Equity

Reporting and Analyzing Investments

Performance Measurement

Filters