Exam 12: Statement of Cash Flows

The following is a partial list of accounts and balances for the Flores Corporation.Prepare the operating activities section of the statement of cash flows for 2016 using the indirect method. Additional information: Net income for 2016 was $36,900;depreciation expense was $26,700;equipment with a book value of $20,000 was sold for $18,000 cash.

Which of the following transactions affects cash flows?

The following beginning and ending balances were drawn from the records of Allen Co. If Allen Co.sold equipment that had an original cost of $175,000 and accumulated depreciation of $75,000 for $62,500,how much did Allen pay for new equipment?

How can cash flow from operating activities be greater than net income from operations?

For the year ended December 31,2016,Carsom Company had cash collections from customers of $220,000,cash paid to employees of $32,000,cash paid to suppliers of $100,000,cash used to retire long-term bonds of $32,000,and cash payments for dividends of $20,000.Based on this information,the amount of cash provided by operating activities for 2016 is:

Gerrity,Inc.uses the perpetual inventory method.During the year,Gerrity purchased $34,500 of inventory on account under the terms 2/10,net 30.After receipt of the merchandise,Gerrity discovered some of the merchandise was defective and returned $6,000 of merchandise.Gerrity River paid the total liability for the merchandise within the discount period.All merchandise was finally sold for $39,000 cash. What would be the net cash flow from operating activities resulting from the above transactions?

Use the following to answer questions During 2016 the El Paso Company had the following changes in account balances: 1)The Accumulated Depreciation account had a beginning balance of $25,000 and an ending balance of $35,000.The increase was due to depreciation expense. 2)The Long-Term Notes Payable account had a beginning balance of $40,000 and an ending balance of $15,000.The decrease was due to repayment of debt. 3)The Equipment Account had a beginning balance of $25,000 and an ending balance of $92,500.The increase was due to the purchase of other operational assets. 4)The Long Term Investments Account (Marketable Securities)had a beginning balance of $18,000 and an ending balance of $12,500.The decrease was due to the sale of investments at cost. 5)The Dividends Payable account had a beginning balance of $12,000 and an ending balance of $10,000.There were $20,000 of dividends declared during the period. 6)The Interest Payable account had a beginning balance of $2,250 and an ending balance of $1,250.The difference was due to the payment of interest. -What is the net cash flow from investing activities?

On the statement of cash flows,cash receipts from interest and dividends are classified as investing activities.

The following information is for Cleveland Company: Additional data for 2016: (1)Sales on account for the period were $80,000. (2)Operating expenses for the period were $52,000. Based on this limited information,what was the net cash inflow from operations?

Which section of a statement of cash flows resembles an income statement?

Use the following to answer questions The Jackson Company issued a one-year $80,000 face value interest-bearing note with a stated interest rate of 9%.The note was issued to the Galaxy Bank on August 1,2016. -The amount of cash flow from financing activities on the December 31,2016 statement of cash flows would be:

List the three categories of cash inflows and outflows shown on the statement of cash flows.

Use the following to answer questions Erie Company reports the following comparative balance sheets and income statement information. -Assuming accounts payable is used for inventory purchases only,the amount of cash paid for inventory purchases during 2016 was:

Goodloe Corporation's credit sales for 2016 were $500,000,and the balance in its accounts receivable increased by $26,000 during the year.In 2016,Goodloe collected $526,000 in cash from its customers.

Warren Corporation's balance sheet reports equipment that originally cost $65,000.The accumulated depreciation for the equipment is $25,000.Warren sells the equipment for $37,000.What would the effect be on its income statement and statement of cash flows?

Interest expense and interest paid are shown as:

On September 1,2016,the Laredo Company purchased equipment making a down payment of $15,500 cash and signing a one-year note payable on the $22,500 balance.The note carried an interest rate of 6%,and all interest was to be paid on the maturity date.Which of the following correctly shows the combined effect of the purchase as well as the accrual of interest on December 31,2016?

Howard Co.made a $25,000 cash payment on a term loan.The payment included a $23,000 reduction of principal as well as $2,000 of interest.Show the combined effects of the events.

On September 10,2016,Howard Corporation received a check for $250 for dividends on Truxell Corporation stock that Howard holds as an investment.Show the effects of this transaction on Howard's income statement and statement of cash flows.

Which of the following transactions is a use of cash?