Exam 24: The Statement of Cash Flows

When the ____________________ method of preparing the statement of cash flows is used, the interest and income taxes paid during the period are disclosed in notes accompanying the statement.

If the indirect method of preparing the statement of cash flows is used, a note disclosing the amount of interest and income taxes paid during the period must accompany the statement.

Explain the differences between the direct and the indirect methods of preparing the operating activities of the statement of cash flows.

The Natural Company's balance sheet would report the balance of Cash on December 31, 2013

Purchases and sales of land, buildings, and equipment for cash are shown as ____________________ activities on the statement of cash flows.

The purchase of treasury stock is treated as a cash outflow in the ____________________ activities section of the statement of cash flows.

When a firm issues a long-term note payable, the amount that it receives for the note is considered a cash inflow from operating activities.

Cannon Manufacturing Co. sold equipment that cost $18,000 for $6,000. A loss on sale of $1,000 was recorded. How is the Cash Flows from Investing Activities affected?

If a corporation issued stock for $70,000 in cash, received $10,000 in cash from a long-term loan, and paid cash dividends totaling $20,000, the net cash provided by its financing activities would be ___________________.

When the net income is adjusted to arrive at the net cash provided by operating activities, the amount of the bond premium amortized is added to the net income.

The net cash provided by operating activities is affected by

On a statement of cash flows, an increase in a prepaid expense

The Natural Company's Statement of Cash Flows would report Cash Flows from Investing Activities totaling:

Chattel Company sold for $7,000 equipment that originally cost $40,000 and had depreciation in the amount of $34,000 taken. What amount is reported in the Cash Flows from Financing Activities section of the Statement of Cash Flows?

Additional information: Plant assets that originally cost $67,200 were sold for $56,000, resulting in a gain of $8,200. Dividends of $35,815 were declared and paid. There were no dividends declared in 2013. -Using the information provided, prepare the cash flows from investing activities for The Kerfuffle Company.

A complete set of published financial statements for a corporation must include a statement of cash flow.

Corporations do not commonly use the direct method for the Statement of Cash Flows because

The resale of treasury stock is classified as a cash inflow from financing activities.

Additional information: Plant assets that originally cost $67,200 were sold for $56,000, resulting in a gain of $8,200. Dividends of $35,815 were declared and paid. There were no dividends declared in 2013. -Using the information provided, prepare the cash flows from financing activities for The Kerfuffle Company.

The statement of cash flows provides information about cash flows from operating activities, investing activities, and financing activities.