Question 1

The repayment of the principal of a loan which had been used to finance the purchase of equipment should be reported on the statement of cash flows as a:

Accepted Answer

A) cash outflow from investing activities. 
B) cash outflow from operating activities. 
C) cash outflow from financing activities. 
D) noncash investing and financing activities in a supplemental disclosure. 
A) cash outflow from investing activities. 
B) cash outflow from operating activities. 
C) cash outflow from financing activities. 
D) noncash investing and financing activities in a supplemental disclosure.

Question 2

In calculating the net cash provided by or used in operations using the indirect method,which of the following items would be added to net income?

Accepted Answer

A) An increase in Accounts Receivable. 
B) A decrease in Prepaid Rent. 
C) An increase in long-lived assets. 
D) A decrease in Salaries and Wages Payable. 
A) An increase in Accounts Receivable. 
B) A decrease in Prepaid Rent. 
C) An increase in long-lived assets. 
D) A decrease in Salaries and Wages Payable.

Question 3

Using the indirect method,which of the following would not be added to net income?

Accepted Answer

A) An increase in Equipment. 
B) A decrease in Prepaid Insurance. 
C) An increase in Salaries and Wages Payable. 
D) A decrease in Supplies. 
A) An increase in Equipment. 
B) A decrease in Prepaid Insurance. 
C) An increase in Salaries and Wages Payable. 
D) A decrease in Supplies.

Question 4

Which of the following would be included in cash flows from financing activities?

Accepted Answer

A) Cash proceeds from sales. 
B) Cash received from a sale of land. 
C) Cash dividends paid. 
D) Cash used for purchases of equipment. 
A) Cash proceeds from sales. 
B) Cash received from a sale of land. 
C) Cash dividends paid. 
D) Cash used for purchases of equipment.

Question 5

St.Pierre Enterprises reported the following information in its financial statements: $\begin{array}{lrr}
\text { Amounts are as of or for the year ended } & \text { Prior Year } & \text { Current Year } \
\text { Inventory } & \$ 55,000 & \$ 80,000\
\text { Accounts Receivable } & 68,000 & 103,000 \
\text { Accounts Payable } & 34,500 & 40,000 \
\text { Sales Revenue } & 305,000 & 375,000 \
\text { Cost of Goods Sold } & 203,000 & 250,000
\end{array}$ What is the amount of cash payments made to suppliers during the current year?

Accepted Answer

A) $280,500 
B) $269,500 
C) $394,500 
D) $230,500 
A) $280,500 
B) $269,500 
C) $394,500 
D) $230,500

Question 6

If operating cash flows are calculated using the indirect method,which of the choices below correctly states the direction of adjustments to convert net income into net cash provided by or used in operations?

Accepted Answer

A) Option A 
B) Option B 
C) Option C 
D) Option D 
A) Option A 
B) Option B 
C) Option C 
D) Option D

Question 7

When preparing the statement of cash flow using the indirect method,Depreciation Expense is:

Accepted Answer

A) added back to net income under the operating activities section. 
B) subtracted from net income under the operating activities section. 
C) subtracted net income under the financing activities section. 
D) added back to net income under the financing activities section. 
A) added back to net income under the operating activities section. 
B) subtracted from net income under the operating activities section. 
C) subtracted net income under the financing activities section. 
D) added back to net income under the financing activities section.

Question 8

Which of the following variations of the accounting equation describes the preparation of the statement of cash flows?

Accepted Answer

A) Change in cash = Change in (Liabilities + Stockholders' equity − Noncash assets) 
B) Change in cash = Change in (Liabilities − Stockholders' equity + Noncash assets) 
C) Change in cash = Change in (Liabilities + Stockholders' equity + Noncash assets) 
D) Change in cash = Change in (Liabilities − Stockholders' equity − Noncash assets) 
A) Change in cash = Change in (Liabilities + Stockholders' equity − Noncash assets) 
B) Change in cash = Change in (Liabilities − Stockholders' equity + Noncash assets) 
C) Change in cash = Change in (Liabilities + Stockholders' equity + Noncash assets) 
D) Change in cash = Change in (Liabilities − Stockholders' equity − Noncash assets)

Question 9

A company purchased money market funds with cash during the current year.Which of the following statements is correct?

Accepted Answer

A) This transaction will result in a decrease in cash from operating activities. 
B) This transaction will result in a decrease in cash from investing activities. 
C) This transaction will result in a decrease in cash from financing activities. 
D) This transaction will not cause a change in cash from operating,investing,or financing activities. 
A) This transaction will result in a decrease in cash from operating activities. 
B) This transaction will result in a decrease in cash from investing activities. 
C) This transaction will result in a decrease in cash from financing activities. 
D) This transaction will not cause a change in cash from operating,investing,or financing activities.

Question 10

A machine with a cost of $234,000 and accumulated depreciation of $153,000 is sold for $63,000 cash.
Required:
Part a.Prepare the journal entry to record this transaction.
Part b.Explain how this transaction would be reported on the statement of cash flows prepared using the indirect method.

Accepted Answer

Part a
 @#IMG-DLM& 
Part b
The loss on disposal in

Question 11

Scots Glenn Manufacturing took out $532,000 of new debt this year and repaid $800,000 of older debt in the same year.The company also issued stock for $353,600 cash and paid dividends of $79,200 for the year.The company's financing cash flows appearing the statement of cash flows will show:

Accepted Answer

A) Net cash used in financing activities of $347,200. 
B) Net cash used in financing activities of $268,000. 
C) Net cash provided by financing activities of $6,400. 
D) Net cash provided by financing activities of $85,600. 
A) Net cash used in financing activities of $347,200. 
B) Net cash used in financing activities of $268,000. 
C) Net cash provided by financing activities of $6,400. 
D) Net cash provided by financing activities of $85,600.

Question 12

Marion Manufacturing had the following cash flows for the current year.The company uses the direct method in preparing the statement of cash flows. $\begin{array}{lr}
\text { Cash receipts from issuance of stock } & 60,000 \
\text { Bonds payable issued at face value } & 250,000 \
\text { Cash dividends received from long-term investments } & 4,500 \
\text { Cash paid for wages } & 20,000 \
\text { Cash paid for dividends } & 5,000 \
\text { Cash received from customers } & 42,500 \
\text { Cash paid for other operating expenses } & 19,500\
\text { Cash paid to purchase equipment }&100,000
\end{array}$ What is the net cash provided by (used in)operating activities?

Accepted Answer

A) $7,500 
B) $3,000 
C) ($2,000) 
D) ($37,500) 
A) $7,500 
B) $3,000 
C) ($2,000) 
D) ($37,500)

Question 13

Cash and cash equivalents include assets that:

Accepted Answer

A) have stable long-term value. 
B) are short-term,highly liquid,and purchased by the entity within three months of maturity. 
C) consistently grow in value over the long run. 
D) are expected to be used up within a year. 
A) have stable long-term value. 
B) are short-term,highly liquid,and purchased by the entity within three months of maturity. 
C) consistently grow in value over the long run. 
D) are expected to be used up within a year.

Question 14

A healthy company typically shows positive cash flows in the financing activities section of the statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 15

Alton Baker Company's balance sheet indicated that the cash account increased by $15,120 during the past year.Net cash provided by operating activities was $39,200 and net cash used in investing activities was $17,080.What was the net cash flow effect of the company's financing activities?

Accepted Answer

A) Net cash provided of $7,000. 
B) Net cash used of $7,000. 
C) Net cash used of $41,160. 
D) Net cash provided of $41,160. 
A) Net cash provided of $7,000. 
B) Net cash used of $7,000. 
C) Net cash used of $41,160. 
D) Net cash provided of $41,160.

Question 16

Consider the following information:
   Required:
Use the direct method to compute the amount of net cash flows provided by (used in)operating activities.

Accepted Answer

The answer of Consider the following information:
   Required:
Use...

Question 17

St.Pierre Enterprises reported the following information in its financial statements: $\begin{array}{lrr}
\text { Amounts are as of or for the year ended } & \text { Prior Year } & \text { Current Year } \
\text { Inventory } & \$ 55,000 & \$ 80,000\
\text { Accounts Receivable } & 68,000 & 103,000 \
\text { Accounts Payable } & 34,500 & 40,000 \
\text { Sales Revenue } & 305,000 & 375,000 \
\text { Cost of Goods Sold } & 203,000 & 250,000
\end{array}$ What is the amount of cash collected from customers during the current year?

Accepted Answer

A) $350,000 
B) $380,500 
C) $340,000 
D) $410,000 
A) $350,000 
B) $380,500 
C) $340,000 
D) $410,000

Question 18

Southview Company's interest revenue for the period is $28,000 and the beginning and ending interest receivable balances are $2,640 and $11,800,respectively,cash received for interest is:

Accepted Answer

A) $28,000. 
B) $18,840. 
C) $37,000. 
D) $16,200. 
A) $28,000. 
B) $18,840. 
C) $37,000. 
D) $16,200.

Question 19

Westmoreland Corporation prepared its statement of cash flows for the year.The following information is taken from that statement:   What is the cash balance at the beginning of the year?

Accepted Answer

A) $15,680 
B) $7,840 
C) $17,640 
D) $43,120 
A) $15,680 
B) $7,840 
C) $17,640 
D) $43,120

Question 20

If sales are $680,000 and the beginning and ending balances of Accounts Receivable are $34,400 and $38,400,respectively,the cash collected from customers is:

Accepted Answer

A) $680,000. 
B) $641,600. 
C) $676,000. 
D) $684,000. 
A) $680,000. 
B) $641,600. 
C) $676,000. 
D) $684,000.

The repayment of the principal of a loan which had been used to finance the purchase of equipment should be reported on the statement of cash flows as a:

In calculating the net cash provided by or used in operations using the indirect method,which of the following items would be added to net income?

Using the indirect method,which of the following would not be added to net income?

Which of the following would be included in cash flows from financing activities?

If operating cash flows are calculated using the indirect method,which of the choices below correctly states the direction of adjustments to convert net income into net cash provided by or used in operations?

When preparing the statement of cash flow using the indirect method,Depreciation Expense is:

Which of the following variations of the accounting equation describes the preparation of the statement of cash flows?

A company purchased money market funds with cash during the current year.Which of the following statements is correct?

A machine with a cost of $234,000 and accumulated depreciation of $153,000 is sold for $63,000 cash. Required: Part a.Prepare the journal entry to record this transaction. Part b.Explain how this transaction would be reported on the statement of cash flows prepared using the indirect method.

Scots Glenn Manufacturing took out $532,000 of new debt this year and repaid $800,000 of older debt in the same year.The company also issued stock for $353,600 cash and paid dividends of $79,200 for the year.The company's financing cash flows appearing the statement of cash flows will show:

Cash and cash equivalents include assets that:

A healthy company typically shows positive cash flows in the financing activities section of the statement of cash flows.

Alton Baker Company's balance sheet indicated that the cash account increased by $15,120 during the past year.Net cash provided by operating activities was $39,200 and net cash used in investing activities was $17,080.What was the net cash flow effect of the company's financing activities?

Consider the following information: Required: Use the direct method to compute the amount of net cash flows provided by (used in)operating activities.

Southview Company's interest revenue for the period is $28,000 and the beginning and ending interest receivable balances are $2,640 and $11,800,respectively,cash received for interest is:

Westmoreland Corporation prepared its statement of cash flows for the year.The following information is taken from that statement: What is the cash balance at the beginning of the year?

If sales are $680,000 and the beginning and ending balances of Accounts Receivable are $34,400 and $38,400,respectively,the cash collected from customers is:

Business Decisions and Financial Accounting

The Balance Sheet

The Income Statement

Adjustments,Financial Statements,and Financial Results

Fraud,Internal Control,and Cash

Merchandising Operations and the Multistep Income Statement

Inventory and Cost of Goods Sold

Receivables,Bad Debt Expense,and Interest Revenue

Long-Lived Tangible and Intangible Assets

Liabilities

Stockholders Equity

Measuring and Evaluating Financial Performance

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Exam 12: Statement of Cash Flows

The repayment of the principal of a loan which had been used to finance the purchase of equipment should be reported on the statement of cash flows as a:

In calculating the net cash provided by or used in operations using the indirect method,which of the following items would be added to net income?

Using the indirect method,which of the following would not be added to net income?

Which of the following would be included in cash flows from financing activities?

If operating cash flows are calculated using the indirect method,which of the choices below correctly states the direction of adjustments to convert net income into net cash provided by or used in operations?

When preparing the statement of cash flow using the indirect method,Depreciation Expense is:

Which of the following variations of the accounting equation describes the preparation of the statement of cash flows?

A company purchased money market funds with cash during the current year.Which of the following statements is correct?

A machine with a cost of $234,000 and accumulated depreciation of $153,000 is sold for $63,000 cash. Required: Part a.Prepare the journal entry to record this transaction. Part b.Explain how this transaction would be reported on the statement of cash flows prepared using the indirect method.

Scots Glenn Manufacturing took out $532,000 of new debt this year and repaid $800,000 of older debt in the same year.The company also issued stock for $353,600 cash and paid dividends of $79,200 for the year.The company's financing cash flows appearing the statement of cash flows will show:

Cash and cash equivalents include assets that:

A healthy company typically shows positive cash flows in the financing activities section of the statement of cash flows.

Alton Baker Company's balance sheet indicated that the cash account increased by $15,120 during the past year.Net cash provided by operating activities was $39,200 and net cash used in investing activities was $17,080.What was the net cash flow effect of the company's financing activities?

Consider the following information: Required: Use the direct method to compute the amount of net cash flows provided by (used in)operating activities.

Southview Company's interest revenue for the period is $28,000 and the beginning and ending interest receivable balances are $2,640 and $11,800,respectively,cash received for interest is:

Westmoreland Corporation prepared its statement of cash flows for the year.The following information is taken from that statement: What is the cash balance at the beginning of the year?

If sales are $680,000 and the beginning and ending balances of Accounts Receivable are $34,400 and $38,400,respectively,the cash collected from customers is:

Business Decisions and Financial Accounting

The Balance Sheet

The Income Statement

Adjustments,Financial Statements,and Financial Results

Fraud,Internal Control,and Cash

Merchandising Operations and the Multistep Income Statement

Inventory and Cost of Goods Sold

Receivables,Bad Debt Expense,and Interest Revenue

Long-Lived Tangible and Intangible Assets

Liabilities

Stockholders Equity

Measuring and Evaluating Financial Performance

Filters