Question 1

The investment in stock of another company is considered a significant activity and thus is reported on the statement of cash flows.

Accepted Answer

The answer of The investment in stock of another company...

Question 2

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method.
-Recorded depreciation for the year.

Accepted Answer

A) Inflow from operating activity 
B) Outflow from operating activity 
C) Inflow from investing activity 
D) Outflow from investing activity 
E) Inflow from financing activity
F)Outflow from financing activity
G)Noncash investing and financing activity
H)Not reported on statement of cash flows 
A) Inflow from operating activity 
B) Outflow from operating activity 
C) Inflow from investing activity 
D) Outflow from investing activity 
E) Inflow from financing activity
F)Outflow from financing activity
G)Noncash investing and financing activity
H)Not reported on statement of cash flows

Question 3

Gaulle Company began the year with a balance of $6,000 in Accounts Receivable and ended the year with $9,000 in the account. Revenues for the period amounted to $38,000. Under the direct method, Gaulle will report cash collected from customers of:

Accepted Answer

A)  $44,000 
B)  $35,000 
C)  $41,000 
D)  $47,000 
A)  $44,000 
B)  $35,000 
C)  $41,000 
D)  $47,000

Question 4

For each of the following items, indicate whether it would appear on a statement of cash flows prepared using the Direct method a or the Indirect method b.
-Net income

Accepted Answer

A) Direct 
B) Indirect 
A) Direct 
B) Indirect

Question 5

Cash flows from issuing and repurchasing stock or issuing and repaying retiring debt are classified as

Accepted Answer

A)  operating activities. 
B)  investing activities. 
C)  financing activities. 
D)  borrowing activities. 
A)  operating activities. 
B)  investing activities. 
C)  financing activities. 
D)  borrowing activities.

Question 6

is a measure of a company's ability to meet its future debt obligations after paying income taxes and interest costs and making capital expenditures

Accepted Answer

The answer of is a measure of a company's ability...

Question 7

Cash flows from purchases of merchandise are classified as investing activities.

Accepted Answer

A) True 
 B)False

Question 8

Tara Corp. reported the following information for 2015 and 2016.   How much cash was collected from customers during 2016?

Accepted Answer

A)  $741,000 
B)  $745,000 
C)  $749,000 
D)  $753,000 
A)  $741,000 
B)  $745,000 
C)  $749,000 
D)  $753,000

Question 9

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method.
-Purchased computer equipment for cash.

Accepted Answer

A) Inflow from operating activity 
B) Outflow from operating activity 
C) Inflow from investing activity 
D) Outflow from investing activity 
E) Inflow from financing activity
F)Outflow from financing activity
G)Noncash investing and financing activity
H)Not reported on statement of cash flows 
A) Inflow from operating activity 
B) Outflow from operating activity 
C) Inflow from investing activity 
D) Outflow from investing activity 
E) Inflow from financing activity
F)Outflow from financing activity
G)Noncash investing and financing activity
H)Not reported on statement of cash flows

Question 10

The statement of cash flows summarizes the operating, investing, and financing activities of a business for a period of time.

Accepted Answer

A) True 
 B)False

Question 11

Carpet World Inc. reported the following information for 2015 and 2016.   If Carpet World uses the indirect method to prepare the operating activities section of the statement of cash flows, what amount will be reported as net cash inflow from operating activities for 2016?

Accepted Answer

A)  $64,000 
B)  $66,000 
C)  $68,000 
D)  $70,000 
A)  $64,000 
B)  $66,000 
C)  $68,000 
D)  $70,000

Question 12

When using the indirect method, how is the decrease in accounts payable shown on the statement of cash flows?

Accepted Answer

A)  Operating activity 
B)  Investing activity 
C)  Financing activity 
D)  Noncash investing and financing activity 
A)  Operating activity 
B)  Investing activity 
C)  Financing activity 
D)  Noncash investing and financing activity

Question 13

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method.
-Issued common stock to acquire land and a building.

Accepted Answer

A) Inflow from operating activity 
B) Outflow from operating activity 
C) Inflow from investing activity 
D) Outflow from investing activity 
E) Inflow from financing activity
F)Outflow from financing activity
G)Noncash investing and financing activity
H)Not reported on statement of cash flows 
A) Inflow from operating activity 
B) Outflow from operating activity 
C) Inflow from investing activity 
D) Outflow from investing activity 
E) Inflow from financing activity
F)Outflow from financing activity
G)Noncash investing and financing activity
H)Not reported on statement of cash flows

Question 14

Blecher Co. reported the following information at the end of 2015 and 2016:   An analysis of Blecher's records indicated that there were no cash flow effects resulting from the changes in the two accounts presented above. How should Blecher report the changes in these accounts on a statement of cash flows?

Accepted Answer

A)  Blecher should report $65,000 for the acquisition of land as an investing activity and $65,000 for the issuance of stock as a financing activity. 
B)  Blecher should report $65,000 as a noncash investing and financing activity for the acquisition of land by issuing common stock. 
C)  Blecher should report the issuance of common stock to acquire land in the financing activity section with a net cash flow effect of zero. 
D)  Blecher should report the acquisition of land by issuing common stock in the investing activity section with a net cash flow effect of zero 
A)  Blecher should report $65,000 for the acquisition of land as an investing activity and $65,000 for the issuance of stock as a financing activity. 
B)  Blecher should report $65,000 as a noncash investing and financing activity for the acquisition of land by issuing common stock. 
C)  Blecher should report the issuance of common stock to acquire land in the financing activity section with a net cash flow effect of zero. 
D)  Blecher should report the acquisition of land by issuing common stock in the investing activity section with a net cash flow effect of zero

Question 15

The objective of the indirect method is to reconcile net income to net cash flow from
_______________________________.

Accepted Answer

operating

Question 16

Which of the following statements is false?

Accepted Answer

A)  A balance sheet reports a company's cash balance at a specific date. 
B)  An income statement reports the amounts of revenue and expense on an accrual basis, not the amount of cash received from revenues or paid for expenses. 
C)  A statement of retained earnings reports the amount of cash received from operating activities and the amount of cash paid for dividends. 
D)  A statement of cash flows explains the changes in cash from operating, investing, and financing activities. 
A)  A balance sheet reports a company's cash balance at a specific date. 
B)  An income statement reports the amounts of revenue and expense on an accrual basis, not the amount of cash received from revenues or paid for expenses. 
C)  A statement of retained earnings reports the amount of cash received from operating activities and the amount of cash paid for dividends. 
D)  A statement of cash flows explains the changes in cash from operating, investing, and financing activities.

Question 17

Which of the following statements is true?

Accepted Answer

A)  The method of preparing the operating activities section of a statement of cash flows which adjusts net income to remove the effects of deferrals and accruals for revenues and expenses is the direct method. 
B)  The method of preparing the operating activities section of a statement of cash flows which reports major classes of gross cash receipts and cash payments for revenues and expenses is the indirect method. 
C)  The FASB prefers the indirect method of preparing the operating activities section of the statement of cash flows. 
D)  Most companies use the indirect method of preparing the operating activities section of the statement of cash flows. 
A)  The method of preparing the operating activities section of a statement of cash flows which adjusts net income to remove the effects of deferrals and accruals for revenues and expenses is the direct method. 
B)  The method of preparing the operating activities section of a statement of cash flows which reports major classes of gross cash receipts and cash payments for revenues and expenses is the indirect method. 
C)  The FASB prefers the indirect method of preparing the operating activities section of the statement of cash flows. 
D)  Most companies use the indirect method of preparing the operating activities section of the statement of cash flows.

Question 18

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method.
-Paid the cash dividends declared in g above.

Accepted Answer

A) Inflow from operating activity 
B) Outflow from operating activity 
C) Inflow from investing activity 
D) Outflow from investing activity 
E) Inflow from financing activity
F)Outflow from financing activity
G)Noncash investing and financing activity
H)Not reported on statement of cash flows 
A) Inflow from operating activity 
B) Outflow from operating activity 
C) Inflow from investing activity 
D) Outflow from investing activity 
E) Inflow from financing activity
F)Outflow from financing activity
G)Noncash investing and financing activity
H)Not reported on statement of cash flows

Question 19

All the information needed to compute the cash flow adequacy ratio is found on the balance sheet.

Accepted Answer

A) True 
 B)False

Question 20

Rent expense in Volusia Company's 2016 income statement is $420,000. If Prepaid Rent was $70,000 at December 31, 2015, and is $95,000 at December 31, 2016, the cash paid for rent during 2016 is:

Accepted Answer

A)  $480,000 
B)  $445,000 
C)  $395,000 
D)  $420,000 
A)  $480,000 
B)  $445,000 
C)  $395,000 
D)  $420,000

The investment in stock of another company is considered a significant activity and thus is reported on the statement of cash flows.

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method. -Recorded depreciation for the year.

Gaulle Company began the year with a balance of $6,000 in Accounts Receivable and ended the year with $9,000 in the account. Revenues for the period amounted to $38,000. Under the direct method, Gaulle will report cash collected from customers of:

For each of the following items, indicate whether it would appear on a statement of cash flows prepared using the Direct method a or the Indirect method b. -Net income

Cash flows from issuing and repurchasing stock or issuing and repaying retiring debt are classified as

is a measure of a company's ability to meet its future debt obligations after paying income taxes and interest costs and making capital expenditures

Cash flows from purchases of merchandise are classified as investing activities.

Tara Corp. reported the following information for 2015 and 2016. How much cash was collected from customers during 2016?

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method. -Purchased computer equipment for cash.

The statement of cash flows summarizes the operating, investing, and financing activities of a business for a period of time.

Carpet World Inc. reported the following information for 2015 and 2016. If Carpet World uses the indirect method to prepare the operating activities section of the statement of cash flows, what amount will be reported as net cash inflow from operating activities for 2016?

When using the indirect method, how is the decrease in accounts payable shown on the statement of cash flows?

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method. -Issued common stock to acquire land and a building.

The objective of the indirect method is to reconcile net income to net cash flow from _______________________________.

Which of the following statements is false?

Which of the following statements is true?

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method. -Paid the cash dividends declared in g above.

All the information needed to compute the cash flow adequacy ratio is found on the balance sheet.

Rent expense in Volusia Company's 2016 income statement is $420,000. If Prepaid Rent was $70,000 at December 31, 2015, and is $95,000 at December 31, 2016, the cash paid for rent during 2016 is:

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, Plant, and Equipment, and Intangibles

Current Liabilities, Contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

Financial Statement Analysis

International-Financial-Reporting-Standards

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Exam 12: The Statement of Cash Flows

The investment in stock of another company is considered a significant activity and thus is reported on the statement of cash flows.

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method. -Recorded depreciation for the year.

Gaulle Company began the year with a balance of $6,000 in Accounts Receivable and ended the year with $9,000 in the account. Revenues for the period amounted to $38,000. Under the direct method, Gaulle will report cash collected from customers of:

For each of the following items, indicate whether it would appear on a statement of cash flows prepared using the Direct method a or the Indirect method b. -Net income

Cash flows from issuing and repurchasing stock or issuing and repaying retiring debt are classified as

is a measure of a company's ability to meet its future debt obligations after paying income taxes and interest costs and making capital expenditures

Cash flows from purchases of merchandise are classified as investing activities.

Tara Corp. reported the following information for 2015 and 2016. How much cash was collected from customers during 2016?

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method. -Purchased computer equipment for cash.

The statement of cash flows summarizes the operating, investing, and financing activities of a business for a period of time.

Carpet World Inc. reported the following information for 2015 and 2016. If Carpet World uses the indirect method to prepare the operating activities section of the statement of cash flows, what amount will be reported as net cash inflow from operating activities for 2016?

When using the indirect method, how is the decrease in accounts payable shown on the statement of cash flows?

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method. -Issued common stock to acquire land and a building.

The objective of the indirect method is to reconcile net income to net cash flow from _______________________________.

Which of the following statements is false?

Which of the following statements is true?

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method. -Paid the cash dividends declared in g above.

All the information needed to compute the cash flow adequacy ratio is found on the balance sheet.

Rent expense in Volusia Company's 2016 income statement is $420,000. If Prepaid Rent was $70,000 at December 31, 2015, and is $95,000 at December 31, 2016, the cash paid for rent during 2016 is:

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, Plant, and Equipment, and Intangibles

Current Liabilities, Contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

Financial Statement Analysis

International-Financial-Reporting-Standards

Filters