Exam 13: Statement of Cash Flows

Accounts receivable from sales transactions were $51,000 at the beginning of the year and $64,000 at the end of the year. Net income reported on the income statement for the year was $105,000. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows prepared by the indirect method is

Changes in current assets and current liabilities are reported on the statement of cash flows, indirect method, in the

For each of the following activities that may take place during the accounting period, indicate the effect (a-g) on the statement of cash flows prepared using the indirect method. Choices may be selected as the answer for more than one question. -Purchase of equipment

Durrand Corporation's accumulated depreciation increased by $12,000, while patents decreased by $2,200 between consecutive balance sheet dates. There were no purchases or sales of depreciable or intangible assets during the year. In addition, the income statement showed a gain of $4,300 from sale of land. Reconcile a net income of $65,000 to net cash flow from operating activities.

Which of the following would not be found in a schedule of noncash investing and financing activities, reported at the end of a statement of cash flows?

Identify the section of the statement of cash flows (a-d) where each of the following items would be reported. -Decrease in inventory

Under the indirect method, expenses that do not affect cash are added to net income in the operating activities section of the statement of cash flows.

Cash flows from operating activities, as part of the statement of cash flows, include cash flow from transactions that enter into the determination of net income.

Accounts receivable resulting from sales to customers amounted to $40,000 and $31,000 at the beginning and end of the year, respectively. Net income reported on the income statement for the year was $120,000. Exclusive of the effect of other adjustments, the net cash flows from operating activities to be reported on the statement of cash flows using the indirect method is

On the statement of cash flows prepared by the indirect method, a $50,000 gain on the sale of investments would be

The net income reported on the income statement for the current year was $275,000. Depreciation recorded on fixed assets and amortization of patents for the year were $40,000 and $9,000, respectively. Balances of current asset and current liability accounts at the end and at the beginning of the year are as follows: End Beginning Cash \ 50,000 \ 60,000 Accounts receivable 112,000 108,000 Inventories 105,000 93,000 Prepaid expenses 4,500 6,500 Accounts payable (merchandise creditors) 75,000 89,000 What is the amount of cash flows from operating activities reported on the statement of cash flows prepared by the indirect method?

Zenith Corporation sells some of its used store fixtures. The acquisition cost of the fixtures is $12,500, and the accumulated depreciation on these fixtures is $9,750 at the time of sale. The fixtures are sold for $5,300. The value of this transaction in the investing section of the statement of cash flows is

The Dickinson Company reported net income of $155,000 for the current year. Depreciation recorded on buildings and equipment amounted to $65,000 for the year. In addition, a building with an original cost of $250,000 and accumulated depreciation of $190,000 on the date of the sale, was sold for $75,000. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: ​ End of Year Beginning of Year Cash \ 20,000 \ 15,000 Accounts receivable 19,000 32,000 Inventories 50,000 65,000 Accounts payable 12,000 18,000 Prepare the cash flows from the operating activities section of the statement of cash flows using the indirect method.

Cash receipts received from the issuance of a mortgage notes payable would be classified as a(n)

The order of presentation of activities on the statement of cash flows is

The following selected account balances appeared on the financial statements of the Washington Company. Use these balances to answer the questions that follow. Accounts receivable, Jan. 1 \ 13,000 Accounts receivable, Dec. 31 9,000 Accounts payable, Jan. 1 4,000 Accounts payable, Dec. 31 7,000 Inventory, Jan. 1 10,000 Inventory, Dec. 31 15,000 Sales 56,000 Cost of goods sold 31,000 The Washington Company uses the direct method to calculate net cash flow from operating activities. Assume that all accounts payable are owed to merchandise suppliers. ​ -Cash payments for merchandise were

Free cash flow is the measure of operating cash flow available for corporate purposes after providing sufficient fixed asset additions to maintain current operations.

The statement of cash flows is not one of the basic financial statements.

On the basis of the following data for Larson Co. for the year ending December 31 Year 2, and the preceding year ended December 31 Year 1, prepare a statement of cash flows. Use the indirect method of reporting cash flows from operating activities. In addition to the balance sheet data, assume that: Equipment costing $125,000 was purchased for cash. Equipment costing $85,000 with accumulated depreciation of $65,000 was sold for $15,000. The stock was issued for cash. ​ The only entries in the retained earnings account were net income of $51,000 and cash dividends declared of $13,000. ​