Question 1

Under the direct method,the only section that differs from the indirect method is the financing activities section.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is NOT a part of financing activities?

Accepted Answer

A) Paying dividends 
B) Issuing stock 
C) Paying off loans 
D) Buying land 
A) Paying dividends 
B) Issuing stock 
C) Paying off loans 
D) Buying land

Question 3

Of the following,which is NOT classified as an investing activity on the Statement of Cash Flows?

Accepted Answer

A) Sale of equipment for cash 
B) Purchasing land 
C) Collecting the principal on loans 
D) Selling goods and services 
A) Sale of equipment for cash 
B) Purchasing land 
C) Collecting the principal on loans 
D) Selling goods and services

Question 4

Operating activities are transactions and events associated with selling a product or providing a service related to the:

Accepted Answer

A) revenues and expenses reported on the Income Statement. 
B) assets and liabilities reported on the Balance Sheet. 
C) net income reported on the Statement of Retained Earnings. 
D) Retained Earnings reported on the Balance Sheet. 
A) revenues and expenses reported on the Income Statement. 
B) assets and liabilities reported on the Balance Sheet. 
C) net income reported on the Statement of Retained Earnings. 
D) Retained Earnings reported on the Balance Sheet.

Question 5

The gains and losses on the sale of equipment under the direct method would be reported:

Accepted Answer

A) in the investing section of the cash flow statement. 
B) in the operating section of the cash flow statement. 
C) in the financing section of the cash flow statement. 
D) they are not reported on the cash flow statement. 
A) in the investing section of the cash flow statement. 
B) in the operating section of the cash flow statement. 
C) in the financing section of the cash flow statement. 
D) they are not reported on the cash flow statement.

Question 6

Enterprise Industries' Accounts Receivable decreased by $30,000 and its Accounts Payable decreased by $16,000.What is the net effect on cash from operations under the indirect method?

Accepted Answer

A) +$46,000 
B) -$46,000 
C) -$14,000 
D) +$14,000 
A) +$46,000 
B) -$46,000 
C) -$14,000 
D) +$14,000

Question 7

S&C's records show Accounts Receivable amounted to $215,000 at the beginning of the year and $245,000 at the end of the year.Income reported on the Income Statement for the year was $300,000.The cash flow from operating activities on the cash flow statement using the indirect method is:

Accepted Answer

A) $330,000. 
B) $270,000. 
C) $300,000. 
D) $315,000. 
A) $330,000. 
B) $270,000. 
C) $300,000. 
D) $315,000.

Question 8

Which would be subtracted from net income in the operating section of an indirect cash flow statement?

Accepted Answer

A) A decrease in Notes Payable 
B) A decrease in prepaid expenses 
C) An increase in sales tax payable 
D) An increase in inventory 
A) A decrease in Notes Payable 
B) A decrease in prepaid expenses 
C) An increase in sales tax payable 
D) An increase in inventory

Question 9

Financing activities affect:

Accepted Answer

A) current and long-term assets. 
B) current and long-term liabilities. 
C) current assets and current liabilities. 
D) long-term liabilities and equity accounts. 
A) current and long-term assets. 
B) current and long-term liabilities. 
C) current assets and current liabilities. 
D) long-term liabilities and equity accounts.

Question 10

Of the following,which would be added back to net income in the operating section of a cash flow statement using the indirect method?

Accepted Answer

A) Increase in inventory 
B) Decrease in Accounts Payable 
C) Increase in Accounts Receivable 
D) Decrease in Prepaid Insurance 
A) Increase in inventory 
B) Decrease in Accounts Payable 
C) Increase in Accounts Receivable 
D) Decrease in Prepaid Insurance

Question 11

The purchase of treasury stock is shown as a cash outflow in the investing section of the cash flow statement.

Accepted Answer

A) True 
 B)False

Question 12

Cash payments for inventory are computed as- Total inventory purchased plus a decrease in Accounts Payable OR minus an increase in Accounts Payable.

Accepted Answer

A) True 
 B)False

Question 13

A comparative Balance Sheet reports at least two consecutive years of information that can be used to compile a Statement of Cash Flows.

Accepted Answer

A) True 
 B)False

Question 14

The following information is available for Bestway Company.What amount is paid for merchandise for the current year (2012)?

Accepted Answer

A) $874,000 
B) $870,000 
C) $856,000 
D) $888,000 
A) $874,000 
B) $870,000 
C) $856,000 
D) $888,000

Question 15

Operating expenses other than depreciation for the year were $563,000.Accrued expenses decreased by $47,000.Cash payments for operating expenses to be reported on the cash flow statement using the direct method would be:

Accepted Answer

A) $47,000. 
B) $516,000. 
C) $563,000. 
D) $610,000. 
A) $47,000. 
B) $516,000. 
C) $563,000. 
D) $610,000.

Question 16

Which of the following is NOT a part of operating activities?

Accepted Answer

A) Paying dividends 
B) Paying payables 
C) Earnings revenue 
D) Paying utilities 
A) Paying dividends 
B) Paying payables 
C) Earnings revenue 
D) Paying utilities

Question 17

A comparative Balance Sheet details why the ending cash balance increased or decreased.

Accepted Answer

A) True 
 B)False

Question 18

The ________ is the financial statement associated with the operating,investing and financing activities of a corporation.

Accepted Answer

A) Income Statement 
B) Statement of Stockholders' Equity 
C) Statement of Cash Flows 
D) Balance Sheet 
A) Income Statement 
B) Statement of Stockholders' Equity 
C) Statement of Cash Flows 
D) Balance Sheet

Question 19

The accuracy of the Statement of Cash Flows can be verified by computing the change in the balance of the:

Accepted Answer

A) cash and cash equivalent accounts. 
B) equity account. 
C) revenue accounts. 
D) asset and liability accounts. 
A) cash and cash equivalent accounts. 
B) equity account. 
C) revenue accounts. 
D) asset and liability accounts.

Question 20

Operating Cash Flows affect:

Accepted Answer

A) current assets and current liabilities. 
B) long-term asset accounts. 
C) equity accounts. 
D) long-term liability accounts. 
A) current assets and current liabilities. 
B) long-term asset accounts. 
C) equity accounts. 
D) long-term liability accounts.

Under the direct method,the only section that differs from the indirect method is the financing activities section.

Which of the following is NOT a part of financing activities?

Of the following,which is NOT classified as an investing activity on the Statement of Cash Flows?

Operating activities are transactions and events associated with selling a product or providing a service related to the:

The gains and losses on the sale of equipment under the direct method would be reported:

Enterprise Industries' Accounts Receivable decreased by $30,000 and its Accounts Payable decreased by $16,000.What is the net effect on cash from operations under the indirect method?

S&C's records show Accounts Receivable amounted to $215,000 at the beginning of the year and $245,000 at the end of the year.Income reported on the Income Statement for the year was $300,000.The cash flow from operating activities on the cash flow statement using the indirect method is:

Which would be subtracted from net income in the operating section of an indirect cash flow statement?

Financing activities affect:

Of the following,which would be added back to net income in the operating section of a cash flow statement using the indirect method?

The purchase of treasury stock is shown as a cash outflow in the investing section of the cash flow statement.

Cash payments for inventory are computed as- Total inventory purchased plus a decrease in Accounts Payable OR minus an increase in Accounts Payable.

A comparative Balance Sheet reports at least two consecutive years of information that can be used to compile a Statement of Cash Flows.

The following information is available for Bestway Company.What amount is paid for merchandise for the current year (2012)?

Operating expenses other than depreciation for the year were $563,000.Accrued expenses decreased by $47,000.Cash payments for operating expenses to be reported on the cash flow statement using the direct method would be:

Which of the following is NOT a part of operating activities?

A comparative Balance Sheet details why the ending cash balance increased or decreased.

The ________ is the financial statement associated with the operating,investing and financing activities of a corporation.

The accuracy of the Statement of Cash Flows can be verified by computing the change in the balance of the:

Operating Cash Flows affect:

Business, Accounting, and You

Analyzing and Recording Business Transactions

Adjusting and Closing Entries

Accounting for a Merchandising Business

Inventory

The Challenges of Accounting: Standards, internal Control, audits, fraud, and Ethics

Cash and Receivables

Long-Term and Other Assets

Current Liabilities and Long-Term Debt

Corporations: Paid-In Capital and Retained Earnings

Financial Statement Analysis

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Exam 11: The Statement of Cash Flows

Under the direct method,the only section that differs from the indirect method is the financing activities section.

Which of the following is NOT a part of financing activities?

Of the following,which is NOT classified as an investing activity on the Statement of Cash Flows?

Operating activities are transactions and events associated with selling a product or providing a service related to the:

The gains and losses on the sale of equipment under the direct method would be reported:

Enterprise Industries' Accounts Receivable decreased by $30,000 and its Accounts Payable decreased by $16,000.What is the net effect on cash from operations under the indirect method?

S&C's records show Accounts Receivable amounted to $215,000 at the beginning of the year and $245,000 at the end of the year.Income reported on the Income Statement for the year was $300,000.The cash flow from operating activities on the cash flow statement using the indirect method is:

Which would be subtracted from net income in the operating section of an indirect cash flow statement?

Financing activities affect:

Of the following,which would be added back to net income in the operating section of a cash flow statement using the indirect method?

The purchase of treasury stock is shown as a cash outflow in the investing section of the cash flow statement.

Cash payments for inventory are computed as- Total inventory purchased plus a decrease in Accounts Payable OR minus an increase in Accounts Payable.

A comparative Balance Sheet reports at least two consecutive years of information that can be used to compile a Statement of Cash Flows.

The following information is available for Bestway Company.What amount is paid for merchandise for the current year (2012)?

Operating expenses other than depreciation for the year were $563,000.Accrued expenses decreased by $47,000.Cash payments for operating expenses to be reported on the cash flow statement using the direct method would be:

Which of the following is NOT a part of operating activities?

A comparative Balance Sheet details why the ending cash balance increased or decreased.

The ________ is the financial statement associated with the operating,investing and financing activities of a corporation.

The accuracy of the Statement of Cash Flows can be verified by computing the change in the balance of the:

Operating Cash Flows affect:

Business, Accounting, and You

Analyzing and Recording Business Transactions

Adjusting and Closing Entries

Accounting for a Merchandising Business

Inventory

The Challenges of Accounting: Standards, internal Control, audits, fraud, and Ethics

Cash and Receivables

Long-Term and Other Assets

Current Liabilities and Long-Term Debt

Corporations: Paid-In Capital and Retained Earnings

Financial Statement Analysis

Filters