Question 1

In its 2016 income statement,WME reported a $40,000 loss on the sale of equipment.In its reconciliation schedule,WME should:

Accepted Answer

A) Report a $40,000 cash outflow for the direct method. 
B) Show a $40,000 positive adjustment to net income under the indirect method. 
C) Show a $40,000 negative adjustment to net income under the indirect method. 
D) None of these answer choices is correct. 
A) Report a $40,000 cash outflow for the direct method. 
B) Show a $40,000 positive adjustment to net income under the indirect method. 
C) Show a $40,000 negative adjustment to net income under the indirect method. 
D) None of these answer choices is correct.

Question 2

When one enters a $50,000 credit entry to the Land account in a spreadsheet for the statement of cash flows,it represents a negative change in that account and probably is due to selling such assets.

Accepted Answer

A) True 
 B)False

Question 3

In its 2016 income statement,WME reported $440,000 for the cost of goods sold.WME paid inventory suppliers $380,000 in 2016,and its inventory balance decreased by $41,000 during the year.In its reconciliation schedule,WME should:

Accepted Answer

A) Show a $19,000 positive adjustment to net income under the indirect method for the increase in accounts payable. 
B) Show a $19,000 positive adjustment to net income under the indirect method for the decrease in accounts payable. 
C) Show a $19,000 negative adjustment to net income under the indirect method for the increase in accounts payable. 
D) Show a $19,000 negative adjustment to net income under the indirect method for the decrease in accounts payable. 
A) Show a $19,000 positive adjustment to net income under the indirect method for the increase in accounts payable. 
B) Show a $19,000 positive adjustment to net income under the indirect method for the decrease in accounts payable. 
C) Show a $19,000 negative adjustment to net income under the indirect method for the increase in accounts payable. 
D) Show a $19,000 negative adjustment to net income under the indirect method for the decrease in accounts payable.

Question 4

Transactions that represent noncash investing and financing activities must be reported in the statement of cash flows or in disclosure notes.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following is not an inflow of cash?

Accepted Answer

A) Depletion. 
B) Cash borrowed on a short-term note. 
C) Sale of a computer. 
D) Cash borrowed on a long-term note. 
A) Depletion. 
B) Cash borrowed on a short-term note. 
C) Sale of a computer. 
D) Cash borrowed on a long-term note.

Question 6

Partial balance sheets for Yarborough Company and additional information are found below.
   
Additional information for 2016:
July 1: Issued 10,000 shares of common stock for cash.
July 1: Purchased new equipment for cash.
Dec.31 Paid cash dividends of $30,000.
Required:
Prepare the investing activities section of the statement of cash flows for 2016.

Accepted Answer

The answer of Partial balance sheets for Yarborough Company and...

Question 7

Partial balance sheets and additional information are listed below for Monaco Company.
   
Additional information for 2016:
Net income was $270,000.
Depreciation expense was $30,000.
Sales totaled $800,000.
Cost of goods sold totaled $305,000.
Required:
Prepare the summary entry for the amount of cash paid to merchandise suppliers during 2016.

Accepted Answer

The answer of Partial balance sheets and additional information are...

Question 8

Which of the following is always reported as an outflow of cash?

Accepted Answer

A) The accrual of warranty expense. 
B) The declaration of a cash dividend. 
C) The purchase of equipment for cash. 
D) Amortization expense. 
A) The accrual of warranty expense. 
B) The declaration of a cash dividend. 
C) The purchase of equipment for cash. 
D) Amortization expense.

Question 9

An analyst compiled the following information for U Inc.for the year ended December 31,2016:
F1S1S1W1F1F1F10F1S1S1W1F1F1F10Net income was $1,700,000.
F1S1S1W1F1F1F10F1S1S1W1F1F1F10Depreciation expense was $400,000.
F1S1S1W1F1F1F10F1S1S1W1F1F1F10Interest paid was $200,000.
F1S1S1W1F1F1F10F1S1S1W1F1F1F10Income taxes paid were $100,000.
F1S1S1W1F1F1F10F1S1S1W1F1F1F10Common stock was sold for $200,000.
F1S1S1W1F1F1F10F1S1S1W1F1F1F10Preferred stock (8% annual dividend)was sold at par value of $250,000.
F1S1S1W1F1F1F10F1S1S1W1F1F1F10Common stock dividends of $50,000 were paid.
F1S1S1W1F1F1F10F1S1S1W1F1F1F10Preferred stock dividends of $20,000 were paid.
F1S1S1W1F1F1F10F1S1S1W1F1F1F10Equipment with a book value of $100,000 was sold for $200,000.
Using the indirect method,what was U Inc.'s net cash flow from operating activities for the year ended December 31,2016?

Accepted Answer

A) $2,000,000. 
B) $2,030,000. 
C) $2,080,000. 
D) $2,100,000. 
A) $2,000,000. 
B) $2,030,000. 
C) $2,080,000. 
D) $2,100,000.

Question 10

S Company reported net income for 2016 in the amount of $400,000.The company's financial statements also included the following:  
What is net cash provided by operating activities under the indirect method?

Accepted Answer

A) $432,000. 
B) $536,000. 
C) $580,000. 
D) $832,000. 
A) $432,000. 
B) $536,000. 
C) $580,000. 
D) $832,000.

Question 11

A loss on the sale of machinery should be reported in the statement of cash flows as:

Accepted Answer

A) An adjustment to net income under the indirect method. 
B) An operating activity under the direct method. 
C) An investing activity cash outflow. 
D) A noncash investing activity. 
A) An adjustment to net income under the indirect method. 
B) An operating activity under the direct method. 
C) An investing activity cash outflow. 
D) A noncash investing activity.

Question 12

When a transfer is made between cash and cash equivalents with no gain or loss,how is the transaction treated in the statement of cash flows?

Accepted Answer

A) It is included as an operating activity. 
B) It is included as a noncash financing activity. 
C) It is included as an investing activity. 
D) It is not reported. 
A) It is included as an operating activity. 
B) It is included as a noncash financing activity. 
C) It is included as an investing activity. 
D) It is not reported.

Question 13

Which of the following causes a change in cash?

Accepted Answer

A) Accrual of interest payable. 
B) Recording of depreciation expense. 
C) Write-off of an uncollectible account. 
D) Payment of a cash dividend declared in the previous fiscal year. 
A) Accrual of interest payable. 
B) Recording of depreciation expense. 
C) Write-off of an uncollectible account. 
D) Payment of a cash dividend declared in the previous fiscal year.

Question 14

Lite Travel Company's accounting records include the following information:
 
What is the amount of net cash provided by operating activities indicated by the amounts provided?

Accepted Answer

A) $ 50,000. 
B) $ 73,000. 
C) $ 94,000. 
D) $129,000. 
A) $ 50,000. 
B) $ 73,000. 
C) $ 94,000. 
D) $129,000.

Question 15

The accounting records of Harrison Company provided the data below.
   
Required:
Prepare a reconciliation of net income to net cash flows from operating activities.

Accepted Answer

The answer of The accounting records of Harrison Company provided...

Question 16

Generally speaking,cash flows from operating activities include the elements of net income reported on a cash basis.

Accepted Answer

A) True 
 B)False

Question 17

A firm reported salary expense of $239,000 for the current year.The beginning and ending balances in salaries payable were $40,000 and $15,000,respectively.What was the amount of cash paid for salaries?

Accepted Answer

A) $214,000. 
B) $289,000. 
C) $264,000. 
D) $239,000. 
A) $214,000. 
B) $289,000. 
C) $264,000. 
D) $239,000.

Question 18

Companies may report interest received and dividends received as investing activities using:

Accepted Answer

A) U.S.GAAP. 
B) IFRS. 
C) Both U.S.GAAP and IFRS. 
D) Neither U.S.GAAP nor IFRS. 
A) U.S.GAAP. 
B) IFRS. 
C) Both U.S.GAAP and IFRS. 
D) Neither U.S.GAAP nor IFRS.

Question 19

In preparing its cash flow statement for the year ended December 31,2016,Green Co.gathered the following data:  
In its December 31,2016,statement of cash flows,what amount should Green report as net cash from financing activities?

Accepted Answer

A) $40,000. 
B) $54,000. 
C) $60,000. 
D) $74,000. 
A) $40,000. 
B) $54,000. 
C) $60,000. 
D) $74,000.

Question 20

Payments to acquire bonds of other corporations should be classified on a statement of cash flows as:

Accepted Answer

A) A lending activity. 
B) An operating activity. 
C) A financing activity. 
D) An investing activity. 
A) A lending activity. 
B) An operating activity. 
C) A financing activity. 
D) An investing activity.

In its 2016 income statement,WME reported a $40,000 loss on the sale of equipment.In its reconciliation schedule,WME should:

When one enters a $50,000 credit entry to the Land account in a spreadsheet for the statement of cash flows,it represents a negative change in that account and probably is due to selling such assets.

In its 2016 income statement,WME reported $440,000 for the cost of goods sold.WME paid inventory suppliers $380,000 in 2016,and its inventory balance decreased by $41,000 during the year.In its reconciliation schedule,WME should:

Transactions that represent noncash investing and financing activities must be reported in the statement of cash flows or in disclosure notes.

Which of the following is not an inflow of cash?

Which of the following is always reported as an outflow of cash?

S Company reported net income for 2016 in the amount of $400,000.The company's financial statements also included the following: What is net cash provided by operating activities under the indirect method?

A loss on the sale of machinery should be reported in the statement of cash flows as:

When a transfer is made between cash and cash equivalents with no gain or loss,how is the transaction treated in the statement of cash flows?

Which of the following causes a change in cash?

Lite Travel Company's accounting records include the following information: What is the amount of net cash provided by operating activities indicated by the amounts provided?

The accounting records of Harrison Company provided the data below. Required: Prepare a reconciliation of net income to net cash flows from operating activities.

Generally speaking,cash flows from operating activities include the elements of net income reported on a cash basis.

A firm reported salary expense of $239,000 for the current year.The beginning and ending balances in salaries payable were $40,000 and $15,000,respectively.What was the amount of cash paid for salaries?

Companies may report interest received and dividends received as investing activities using:

In preparing its cash flow statement for the year ended December 31,2016,Green Co.gathered the following data: In its December 31,2016,statement of cash flows,what amount should Green report as net cash from financing activities?

Payments to acquire bonds of other corporations should be classified on a statement of cash flows as:

Environment and Theoretical Structure of Financial Accounting

Review of the Accounting Process

The Balance Sheet and Financial Disclosures

The Income Statement, comprehensive Income, and the Statement of Cash Flows

Income Measurement

Time Value of Money Concepts

Cash and Receivables

Inventories: Measurement

Inventories: Additional Issues

Property, plant, and Equipment and Intangible Assets: Acquisition and Disposition

Property, plant, and Equipment and Intangible Assets: Utilization and Impairment

Investments

Current Liabilities and Contingencies

Bonds and Long-Term Notes

Leases

Accounting for Income Taxes

Pensions and Other Postretirement Benefits

Shareholders Equity

Share-Based Compensation and Earnings Per Share

Accounting Changes

Filters

Exam 21: The Statement of Cash Flows

In its 2016 income statement,WME reported a $40,000 loss on the sale of equipment.In its reconciliation schedule,WME should:

When one enters a $50,000 credit entry to the Land account in a spreadsheet for the statement of cash flows,it represents a negative change in that account and probably is due to selling such assets.

In its 2016 income statement,WME reported $440,000 for the cost of goods sold.WME paid inventory suppliers $380,000 in 2016,and its inventory balance decreased by $41,000 during the year.In its reconciliation schedule,WME should:

Transactions that represent noncash investing and financing activities must be reported in the statement of cash flows or in disclosure notes.

Which of the following is not an inflow of cash?

Which of the following is always reported as an outflow of cash?

S Company reported net income for 2016 in the amount of $400,000.The company's financial statements also included the following: What is net cash provided by operating activities under the indirect method?

A loss on the sale of machinery should be reported in the statement of cash flows as:

When a transfer is made between cash and cash equivalents with no gain or loss,how is the transaction treated in the statement of cash flows?

Which of the following causes a change in cash?

Lite Travel Company's accounting records include the following information: What is the amount of net cash provided by operating activities indicated by the amounts provided?

The accounting records of Harrison Company provided the data below. Required: Prepare a reconciliation of net income to net cash flows from operating activities.

Generally speaking,cash flows from operating activities include the elements of net income reported on a cash basis.

A firm reported salary expense of $239,000 for the current year.The beginning and ending balances in salaries payable were $40,000 and $15,000,respectively.What was the amount of cash paid for salaries?

Companies may report interest received and dividends received as investing activities using:

In preparing its cash flow statement for the year ended December 31,2016,Green Co.gathered the following data: In its December 31,2016,statement of cash flows,what amount should Green report as net cash from financing activities?

Payments to acquire bonds of other corporations should be classified on a statement of cash flows as:

Environment and Theoretical Structure of Financial Accounting

Review of the Accounting Process

The Balance Sheet and Financial Disclosures

The Income Statement, comprehensive Income, and the Statement of Cash Flows

Income Measurement

Time Value of Money Concepts

Cash and Receivables

Inventories: Measurement

Inventories: Additional Issues

Property, plant, and Equipment and Intangible Assets: Acquisition and Disposition

Property, plant, and Equipment and Intangible Assets: Utilization and Impairment

Investments

Current Liabilities and Contingencies

Bonds and Long-Term Notes

Leases

Accounting for Income Taxes

Pensions and Other Postretirement Benefits

Shareholders Equity

Share-Based Compensation and Earnings Per Share

Accounting Changes

Filters