Exam 14: Statement of Cash Flows

When using the worksheet method to analyzing noncash accounts ,no order of analysis is required,but it is more efficient to start with Retained Earnings and proceed upward in the account listing.

Each of the events below may have an effect on the statement of cash flows.Designate how the event should be reported within the statement of cash flows using the codes provided below.Codes may be used more than once,or not at all. Codes Events

Depreciation on factory equipment would be reported in the statement of cash flows prepared by the indirect method in

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

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

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 investing activities,as part of the statement of cash flows,include payments for the acquisition of fixed assets.

The manner of reporting cash flows from investing and financing activities will be different under the direct method as compared to the indirect method.

Which of the following should be shown on a statement of cash flows under the financing activity section?

Complete each of the columns on the table below,indicating in which section each item would be reported on the statement of cash flow (Operating,Investing,or Financing),the amount that would be reported,and whether the item would create an increase or decrease in cash.For item that affect more than one section of the statement,indicate all affected.Assume the indirect method of reporting cash flows operating activities. The first item has been completed as an example.

The cash flows from operating activities are reported by the direct method on the statement of cash flows.Determine the following:

For each of the following,identify whether it would be disclosed as an operating (O),financing (F),or investing (I)activity on the statement of cash flows under the indirect method.

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

State the section(s)of the statement of cash flows prepared by the indirect method (operating activities,investing activities,financing activities,or not reported)and the amount that would be reported for each of the following transactions:

On the basis of the details of the common stock account presented below,calculate the total amount to be recorded in financing section of the statement of cash flows.Indicate whether the amount results in an increase or decrease in cash.

Fortune Corporation's comparative balance sheet for current assets and liabilities was as follows: Adjust 2012 net income of $65,000 for changes in operating assets and liabilities to arrive at cash flows from operating activities using the indirect method.

For each of the following,identify whether it would be disclosed as an operating (O),financing (F),or investing (I)activity on the statement of cash flows under the indirect method.

Rarely would the cash flows from operating activities,as reported on the statement of cash flows,be the same as the net income reported on the income statement.

The acquisition of land in exchange for common stock is an example of noncash investing and financing activity.