Exam 13: Statement of Cash Flows

Cash inflows and outflows are not netted in the investing or financing sections of the statement of cash flows but are separately disclosed to give the reader full information.

The following two scenarios are independent of one another.(a)An analysis of the general ledger accounts indicates that office equipment was sold for $39,600 during the year. The equipment originally cost $68,000 and had accumulated depreciation of $22,500 on the date of sale. Indicate how the elements of this transaction would be reported on the statement of cash flows using the indirect method.(b)An analysis of the general ledger accounts indicates that delivery equipment, which cost $97,000 and on which accumulated depreciation totaled $42,100 on the date of sale, was sold for $57,500 during the year. Using this information, indicate the items to be reported on the statement of cash flows.

Which of the following should be deducted from net income in calculating net cash flow from operating activities using the indirect method?

The Dickinson Company reported net income of $155,000 for the current year. Depreciation recorded on buildings and equipment amounted to $65,000 for the year. In addition, a building with an original cost of $250,000 and accumulated depreciation of $190,000 on the date of the sale, was sold for $75,000. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: Prepare the cash flows from the operating activities section of the statement of cash flows using the indirect method.

For each of the following activities that may take place during the accounting period, indicate the effect (a-g) on the statement of cash flows prepared using the indirect method. Choices may be selected as the answer for more than one question.a.Increase cash from operating activities b.Decrease cash from operating activities c.Increase cash from investing activities d.Decrease cash from investing activities e.Increase cash from financing activities f.Decrease cash from financing activities g.Noncash investing and financing activity -Exchange of land for common stock

Cash dividends paid on common stock would be reported in the statement of cash flows in

If a business issued bonds payable in exchange for land, the transaction would be reported in a separate schedule on the statement of cash flows.

The following information is available from the current period financial statements: The net cash flow from operating activities using the indirect method is

The cost of merchandise sold during the year was $50,000. Merchandise inventories were $12,500 and $10,500 at the beginning and end of the year, respectively. Accounts payable (all owed to merchandise suppliers) were $6,000 and $5,000 at the beginning and end of the year, respectively. Using the direct method of reporting cash flows from operating activities, cash payments for merchandise total

Cash receipts received from the issuance of a mortgage notes payable would be classified as a(n)

Which of the following types of transactions would be reported as a cash flow from investing activity on the statement of cash flows?

Which of the following increases cash?

Identify the section of the statement of cash flows (a-d) where each of the following items would be reported.a.Operating activities b.Financing activities c.Investing activities d.Schedule of noncash financing and investing -Loss on sale of equipment

Identify the section of the statement of cash flows (a-d) where each of the following items would be reported.a.Operating activities b.Financing activities c.Investing activities d.Schedule of noncash financing and investing -Issuance of bond payable

Indicate whether each of the following would be added to or deducted from net income in determining net cash flow from operating activities by the indirect method:

Durrand Corporation's accumulated depreciation increased by $12,000, while patents decreased by $2,200 between consecutive balance sheet dates. There were no purchases or sales of depreciable or intangible assets during the year. In addition, the income statement showed a gain of $4,300 from sale of land. Reconcile a net income of $65,000 to net cash flow from operating activities.

Samuel Company's accumulated depreciation-equipment increased by $6,000, while patents decreased by $2,200 between balance sheet dates. There were no purchases or sales of depreciable or intangible assets during the year. In addition, the income statement showed a loss of $3,200 from the sale of investments. Assume no changes in noncash current assets and liabilities.​ Reconcile a net income of $92,000 to net cash flow from operating activities.

For each of the following, identify whether it would be disclosed as an operating (O), financing (F), or investing (I) activity on the statement of cash flows under the indirect method.

Sales for the year were $600,000. Accounts receivable were $100,000 and $80,000 at the beginning and end of the year, respectively. Cash received from customers to be reported on the statement of cash flows using the direct method is

The following selected account balances appeared on the financial statements of the Washington Company. Use these balances to answer the questions that follow. The Washington Company uses the direct method to calculate net cash flow from operating activities. Assume that all accounts payable are owed to merchandise suppliers.​ -Free cash flow is