Exam 12: The Statement of Cash Flows

Under the ______________________________, a company reports its major classes of gross cash receipts and cash payments in the operating activities section of the statement of cash flows.

Which of the following items is treated as a cash equivalent?

To be classified as a cash equivalent, an item must be readily convertible to a known amount of cash and have an original maturity to the investor of three months or more.

Cash equivalents are reported in the Operating Activities section of the statement of cash flows.

The financial statement that summarizes the operating, investing, and financing activities of a business over a period of time is the ___________________________________.

Flannery Company uses a worksheet to prepare its statement of cash flows.The company also uses the indirect method for the Operating Activities section of its statement.For each of the following changes in the balance sheet, indicate what activity it affects and whether it is an addition or deduction. -Inventory decreased

Which of the following measures can be used to evaluate a company's ability to meet future debt obligations after paying income taxes and interest and making capital expenditures?

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:

Which of the following statements is false?

Depreciation is a noncash expense that is added back to net income in determining cash provided from operating activities under the indirect method.

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

Assuming the indirect method for preparing the statement of cash flows is used, indicate whether these items should be added to net income (A), deducted from net income (D), or not be reported in the operating section of the statement under the indirect method (NR). -Depreciation expense

Which of the following items is not a cash equivalent?

The cash flow adequacy ratio is defined as: $\frac {\text {Total Cash Flow - Capital Expenditures } } {\text {Average Debt Maturing over Next Five Years } }$

The primary purpose of the statement of cash flows is to provide information about

If the December 31, 2016, balance of accounts payable is higher than the January 1, 2016, balance, then the amount of cash payments will exceed the purchases on account for the year.

Tulsa Corp.reported the following information for 2016 and 2017. Interest payable, December 31,2016 \ 5,700 Interest payable, December 31,2017 6,200 Interest expense-2017 12,250 How much cash was paid for interest during 2017?

Rent expense in Volusia Company's 2017 income statement is $420,000.If Prepaid Rent was $70,000 at December 31, 2016, and is $95,000 at December 31, 2017, the cash paid for rent during 2017 is:

Cash flows from acquiring and selling products are classified as

When using the indirect method, how is the receipt of cash from the sale of long-term investments treated on the statement of cash flows?