Exam 19: Company Performance: Cash Flows

Seldon Corporation sold a piece of equipment for cash.The sale generated a gain of $10,000 and the equipment originally cost $50,000 and at the time of the sale had accumulated depreciation of $45,000.How much cash was generated by sale and in what section would the cash be reported on the statement of cash flows?

Cash payments made to acquire equipment would be reported in the following section of the statement of cash flows:

On a statement of cash flows using the indirect format,an increase in prepaid insurance is:

Sales totaled $385,000,net accounts receivable had a beginning and ending balance of $39,000 and $45,500,respectively.Cash collections from customers were:

An increase in interest payable during the period indicates that

Which of the following activities is not correctly associated with its cash flow classification?

Which of the following statements about the statement of cash flows is false?

Do you consider the direct or indirect method more useful? Why?

Computer Inc.has the below financial information.Using the direct method (statement of cash flows),solve for cash paid for insurance (show your work). Other Information: Insurance Expense ==> $ 150,000

When adjusting net income to cash using the indirect method describe how each of the following should adjust net income.Added (+),Subtracted (-)or No Adjustment (N A). _____ 1.Increases in Accounts Receivable _____ 2.Gain on Sale of Equipment _____ 3.Decrease in Accounts Payable _____ 4.Depreciation Expense _____ 5.Increase in Land account _____ 6.Decrease in Inventory _____ 7.Decrease in Dividend Payable _____ 8.Increase in Prepaid Insurance _____ 9.Decrease in Discount on Bonds Payable _____10.Decrease in Salaries Payable

Cash inflow from the sale of Trading Securities would be reported in which of the following in the statement of cash flows?

Salaries payable increased from 2009 to 2010.Using the indirect method (statement of cash flows),the increase should be:

Cash flows from operating activities include

Given the following selected information,determine the net cash flows from investing activities and the net cash flows from financing activities: Net income was $189,500 for the period. Purchased 10,000 shares of common stock at $15 per share for the treasury. Sold equipment with a carrying value of $32,500 at a gain of $6,000. Purchased land and a building worth $450,000 by signing a ten-year note payable. Issued $1,000,000 in bonds at par. The beginning and ending retained earnings account balances were $418,000 and $534,000,respectively.There were no prior period adjustments during the period. Wrote a check for $648,000 for the purchase of machinery. Sold temporary investments in marketable securities with a $50,000 carrying value,at a loss of $17,500. Cash dividends were declared and paid during the period.

Cash collections from customers during 2010 were $300,500,while net accounts receivable increased $5,000.Sales reported on the income statement were:

If accounts receivable increased during the period,cash received from customers would be equal to

If accounts payable increased,cash paid for inventory would be equal to

During 2010,cash payments for wages totaled $954,500,while wages payable decreased by $67,800.Wages expense reported on the income statement equaled:

A building with a cost of $683,000,and accumulated depreciation of $397,500,was sold at a gain of $82,000.This transaction would be reported on a statement of cash flows using the indirect format as a(n):