Question 1

A business issues 20-year bonds payable in exchange for preferred stock.This transaction would be reported on the statement of cash flows in

Accepted Answer

A)  a separate schedule 
B)  the cash flows from financing activities section 
C)  the cash flows from investing activities section 
D)  the cash flows from operating activities section 
A)  a separate schedule 
B)  the cash flows from financing activities section 
C)  the cash flows from investing activities section 
D)  the cash flows from operating activities section

Question 2

Equipment with an original cost of $75,000 and accumulated depreciation of $20,000 was sold at a loss of $7,000.As a result of this transaction,cash would

Accepted Answer

A)  increase by $48,000 
B)  decrease by $7,000 
C)  increase by $55,000 
D)  decrease by $27,000 
A)  increase by $48,000 
B)  decrease by $7,000 
C)  increase by $55,000 
D)  decrease by $27,000

Question 3

Which of the following would not be classified as an operating activity?

Accepted Answer

A)  interest expense 
B)  income taxes 
C)  payment of dividends 
D)  selling expenses 
A)  interest expense 
B)  income taxes 
C)  payment of dividends 
D)  selling expenses

Question 4

The statement of cash flows reports a firm's major sources of cash receipts and major uses of cash for a period of time.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following types of transactions would be reported as a cash flow from investing activity on the statement of cash flows?

Accepted Answer

A)  issuance of bonds payable 
B)  issuance of capital stock 
C)  purchase of treasury stock 
D)  purchase of noncurrent assets 
A)  issuance of bonds payable 
B)  issuance of capital stock 
C)  purchase of treasury stock 
D)  purchase of noncurrent assets

Question 6

​Norris Company declared cash dividends of $60,000 during the year.Cash dividends payable were $20,000 at the beginning of the year and $25,000 at the end of the year.The amount of cash Norris Co.used for payment of dividends during the year was

Accepted Answer

A)  ​$55,000 
B)  ​$80,000 
C)  ​$105,000 
D)  ​$65,000 
A)  ​$55,000 
B)  ​$80,000 
C)  ​$105,000 
D)  ​$65,000

Question 7

A company had net income of $252,000.Depreciation expense is $26,000.During the year,accounts receivable and inventory increased by $15,000 and $40,000,respectively.Prepaid expenses and accounts payable decreased by $2,000 and $4,000,respectively.There was also a loss on the sale of equipment of $3,000.How much was the net cash flow from operating activities on the statement of cash flows using the indirect method?

Accepted Answer

A)  $217,000 
B)  $224,000 
C)  $284,000 
D)  $305,000 
A)  $217,000 
B)  $224,000 
C)  $284,000 
D)  $305,000

Question 8

Cash dividends of $45,000 were declared during the year.Cash dividends payable were $10,000 at the beginning of the year and $15,000 at the end of the year.The amount of cash for the payment of dividends during the year is

Accepted Answer

A)  $50,000 
B)  $40,000 
C)  $55,000 
D)  $35,000 
A)  $50,000 
B)  $40,000 
C)  $55,000 
D)  $35,000

Question 9

In calculating cash flows from operating activities using the indirect method,a gain on the sale of equipment is

Accepted Answer

A)  added to net income 
B)  deducted from net income 
C)  ignored because it does not affect cash 
D)  reported supplementally as a noncash investing and financing activity 
A)  added to net income 
B)  deducted from net income 
C)  ignored because it does not affect cash 
D)  reported supplementally as a noncash investing and financing activity

Question 10

The net income reported on an income statement for the current year was $63,000.Depreciation recorded on fixed assets for the year was $24,000.Balances of the current asset and current liability accounts at the end and beginning of the year are listed below.Prepare the Cash Flows from Operating Activities section of the statement of cash flows using the indirect method.

Accepted Answer

The answer of The net income reported on an income...

Question 11

The following two scenarios are independent of one another.

Accepted Answer

The answer of The following two scenarios are independent of...

Question 12

Which of the following should be added to net income in calculating net cash flow from operating activities using the indirect method?

Accepted Answer

A)  depreciation expense 
B)  an increase in inventory 
C)  a gain on the sale of equipment 
D)  dividends declared and paid 
A)  depreciation expense 
B)  an increase in inventory 
C)  a gain on the sale of equipment 
D)  dividends declared and paid

Question 13

Selected data taken from the accounting records of Laser Inc.for the current year ended December 31 are as follows:
​
   During the current year,the cost of goods sold was $448,500,and the operating expenses other than depreciation were $78,000.The direct method is used for presenting the cash flows from operating activities on the statement of cash flows.
​
Required:
Determine the amount reported on the statement of cash flows for:
(a)Cash payments for merchandise
(b)Cash payments for operating expenses

Accepted Answer

The answer of Selected data taken from the accounting records...

Question 14

A building with a book value of $54,000 is sold for $63,000 cash.Using the indirect method,this transaction should be shown on the statement of cash flows as follows:

Accepted Answer

A)  an increase of $54,000 from investing activities 
B)  an increase of $63,000 from investing activities and a deduction from net income of $9,000 
C)  an increase of $9,000 from investing activities 
D)  an increase of $54,000 from investing activities and an addition to net income of $9,000 
A)  an increase of $54,000 from investing activities 
B)  an increase of $63,000 from investing activities and a deduction from net income of $9,000 
C)  an increase of $9,000 from investing activities 
D)  an increase of $54,000 from investing activities and an addition to net income of $9,000

Question 15

Using the indirect method,if land costing $85,000 was sold for $145,000,the amount reported in the financing activities section of the statement of cash flows would be $85,000.

Accepted Answer

A) True 
 B)False

Question 16

Balances of the current asset and current liability accounts at the end and beginning of the year are as follows:
​
   Use the direct method to prepare the cash flows from operating activities section of a statement of cash flows.

Accepted Answer

The answer of Balances of the current asset and current...

Question 17

Net income was $51,000 for the year.The accumulated depreciation balance increased by $14,000 over the year.There were no sales of fixed assets or changes in noncash current assets or liabilities.Under the indirect method,the cash flow from operations is $37,000.

Accepted Answer

A) True 
 B)False

Question 18

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

Accepted Answer

A)  operating,investing,and financing 
B)  operating,financing,and investing 
C)  financing,operating,and investing 
D)  financing,investing,and operating 
A)  operating,investing,and financing 
B)  operating,financing,and investing 
C)  financing,operating,and investing 
D)  financing,investing,and operating

Question 19

A ten-year bond was issued at par for $250,000 cash.This transaction should be shown on a statement of cash flows under

Accepted Answer

A)  investing activities 
B)  financing activities 
C)  noncash investing and financing activities 
D)  operating activities 
A)  investing activities 
B)  financing activities 
C)  noncash investing and financing activities 
D)  operating activities

Question 20

Based on the following,what is free cash flow?
Cash flows from investing include the purchase of a replacement asset for $100,000 and the sale of the one used in production,which is now obsolete,for $70,000.Cash flows from financing include $70,000 of borrowing.

Accepted Answer

$318,000 -

Exam 13: Statement of Cash Flows

A business issues 20-year bonds payable in exchange for preferred stock.This transaction would be reported on the statement of cash flows in

Equipment with an original cost of $75,000 and accumulated depreciation of $20,000 was sold at a loss of $7,000.As a result of this transaction,cash would

Which of the following would not be classified as an operating activity?

The statement of cash flows reports a firm's major sources of cash receipts and major uses of cash for a period of time.

Which of the following types of transactions would be reported as a cash flow from investing activity on the statement of cash flows?

​Norris Company declared cash dividends of $60,000 during the year.Cash dividends payable were $20,000 at the beginning of the year and $25,000 at the end of the year.The amount of cash Norris Co.used for payment of dividends during the year was

Cash dividends of $45,000 were declared during the year.Cash dividends payable were $10,000 at the beginning of the year and $15,000 at the end of the year.The amount of cash for the payment of dividends during the year is

In calculating cash flows from operating activities using the indirect method,a gain on the sale of equipment is

The following two scenarios are independent of one another.

Which of the following should be added to net income in calculating net cash flow from operating activities using the indirect method?

A building with a book value of $54,000 is sold for $63,000 cash.Using the indirect method,this transaction should be shown on the statement of cash flows as follows:

Using the indirect method,if land costing $85,000 was sold for $145,000,the amount reported in the financing activities section of the statement of cash flows would be $85,000.

Balances of the current asset and current liability accounts at the end and beginning of the year are as follows: ​ Use the direct method to prepare the cash flows from operating activities section of a statement of cash flows.

Net income was $51,000 for the year.The accumulated depreciation balance increased by $14,000 over the year.There were no sales of fixed assets or changes in noncash current assets or liabilities.Under the indirect method,the cash flow from operations is $37,000.

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

A ten-year bond was issued at par for $250,000 cash.This transaction should be shown on a statement of cash flows under

Based on the following,what is free cash flow? Cash flows from investing include the purchase of a replacement asset for $100,000 and the sale of the one used in production,which is now obsolete,for $70,000.Cash flows from financing include $70,000 of borrowing.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Internal Control and Cash

Receivables

Long-Term Assets: Fixed and Intangible

Liabilities: Current,installment Notes,and Contingencies

Liabilities: Bonds Payable

Corporations: Organization, stock Transactions, and Dividends

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Cost Systems

Activity-Based Costing

Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Evaluating Variances From Standard Costs

Evaluating Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Lean Manufacturing and Activity Analysis

Filters

Norris Company declared cash dividends of $60,000 during the year.Cash dividends payable were $20,000 at the beginning of the year and $25,000 at the end of the year.The amount of cash Norris Co.used for payment of dividends during the year was

Balances of the current asset and current liability accounts at the end and beginning of the year are as follows: Use the direct method to prepare the cash flows from operating activities section of a statement of cash flows.