Exam 11: The Statement of Cash Flows

An increase in retained earnings indicates that a cash dividend has been paid.

Cash flows from operating activities often relate to an increase or decrease in either a current asset or a current liability.

Selected data and additional information from the company's records are presented below: Additional information: -Refer to Mary Kay Cosmetics. What amount was recorded as depreciation expense during 2014?

Selected data from the financial statements for the years ended December 31, 2014 and 2013, are presented below: The following additional information was obtained from the company's records: -Refer to Maritime Marine Services. What was the amount paid to retire long-term debt during 2014?

When a company sells its own common stock, it is a(n)____________________ activity on the statement of cash flows.

-Refer to Merry Maids Company. What method is used to calculate the net cash provided by operating activities?

When using the direct method to determine operating cash flows, how is the retirement of bonds payable at their maturity date shown on the Statement of Cash Flows?

Match these terms with their correct definition. a.Cash flow adequacy ratio b.Cash flows from financing activities c.Cash flows from investing activities d.Cash flow from operating activities e.Direct method f.Free cash flow g.Income statement h.Indirect method i.Noncash investing & financing activities j.Statement of cash flows -Include cash received from the issuance of stock and cash used to pay dividends.

When using the direct method to determine operating cash flows, how is depreciation expense recorded on the Statement of Cash Flows?

The cash flow adequacy ratio is defined as Free Cash Flow / Average Amount of Debt Maturing over the Next Five Years.

A company reported the following information in its annual report for 2014. Compute the cash flow adequacy ratio for 2014.

A company reported net income of $950,000. Cash from operations

A company reported the following information: How much cash was paid for interest during 2014?

Selected data and additional information from the company's records are presented below: Additional information: -Refer to Mary Kay Cosmetics. Prepare the financing activities section of the company's statement of cash flows for 2014.

When using the direct method to determine operating cash flows, how is the sale of long-term investments for cash reported on the Statement of Cash Flows?

-Refer to Merry Maids Company. At the end of each year, the company's cash balance was approximately $5 to $7 million. What does this indicate about its cash management techniques?

Under the indirect method, the first line in the operating activities section of the statement of cash flows is the net income or loss for the period.

Cash flows from operating activities correspond to the cash effects of items that determine ____________________.

A company reported a net loss of $30,000 for 2014, yet its cash balance increased during the year. Which financial statement should management refer to for an explanation of this situation?

Refer to Mary Kay Cosmetics. Prepare the company's statement of cash flows for the year ended December 31, 2014. Use the direct method of determining net cash flows from operating activities.