Exam 12: Statement of Cash Flows

The most recent comparative balance sheet of Giacomelli Corporation appears below: The company uses the indirect method to construct the operating activities section of its statements of cash flows. Which of the following is correct regarding the operating activities section of the statement of cash flows?

The net cash provided by operating activities on the statement of cash flows does not include any dividends paid to the company's own shareholders.

Megan Corporation's net income last year was $98,000. Changes in the company's balance sheet accounts for the year appear below: The company paid a cash dividend of $36,000 and it did not dispose of any long-term investments or property, plant, and equipment. The company did not issue any bonds payable or repurchase any of its own common stock. The following questions pertain to the company's statement of cash flows. The net cash provided by (used in) operating activities last year was:

Buckley Corporation's most recent comparative balance sheet appears below: The company's net income for the year was $91 and it paid a cash dividend of $22. It did not dispose of any property, plant, and equipment during the year. The company did not retire any bonds payable or repurchase any of its own common stock. The net cash provided by (used in) operating activities for the year was:

Under the indirect method of determining the net cash provided by operating activities on the statement of cash flows, a loss on the sale of an asset would be added to net income.

The most recent balance sheet and income statement of Penaloza Corporation appear below: The company paid a cash dividend of $18. It did not dispose of any property, plant, and equipment. The company did not retire any bonds payable or repurchase any of its own common stock. The following questions pertain to the company's statement of cash flows. The net cash provided by (used in) investing activities for the year was:

The most recent balance sheet and income statement of Penaloza Corporation appear below: The company paid a cash dividend of $18. It did not dispose of any property, plant, and equipment. The company did not retire any bonds payable or repurchase any of its own common stock. The following questions pertain to the company's statement of cash flows. The net cash provided by (used in) financing activities for the year was:

Partin Corporation's cash and cash equivalents consist of cash and marketable securities. Last year the company's cash account increased by $31,000 and its marketable securities account decreased by $22,000. Cash provided by operating activities was $108,000. Net cash used in financing activities was $70,000. Based on this information, the net cash flow from investing activities on the statement of cash flows was:

Belk Corporation's balance sheet appears below: The net income for the year was $126. Cash dividends were $21. The company did not dispose of any property, plant, and equipment, issue any bonds payable, or repurchase any of its own common stock during the year. Required: Prepare a statement of cash flows in good form using the indirect method.

Under the indirect method of determining the net cash provided by operating activities on the statement of cash flows, an increase in property, plant, and equipment is subtracted from net income.

In a statement of cash flows, the sale of a long-term investment would ordinarily be classified as:

Beacham Corporation's net cash provided by operating activities was $115; its net income was $95; its capital expenditures were $65; and its cash dividends were $17. The company's free cash flow was:

Megan Corporation's net income last year was $98,000. Changes in the company's balance sheet accounts for the year appear below: The company paid a cash dividend of $36,000 and it did not dispose of any long-term investments or property, plant, and equipment. The company did not issue any bonds payable or repurchase any of its own common stock. The following questions pertain to the company's statement of cash flows. The net cash provided by (used in) financing activities last year was:

Which of the following items would not be classified as an operating activity on the statement of cash flows?

Cash equivalents on the statement of cash flows consist of any investment that can be converted into cash within one year.

The direct method of preparing the statement of cash flows will show the same increase or decrease in cash as the indirect method.

Marks Corporation's balance sheet appears below: Net income for the year was $77. Cash dividends were $13. The company did not dispose of any property, plant, and equipment, retire any bonds payable, or repurchase any of its own common stock during the year. Required: Prepare a statement of cash flows in good form using the indirect method.

The most recent balance sheet and income statement of Penaloza Corporation appear below: The company paid a cash dividend of $18. It did not dispose of any property, plant, and equipment. The company did not retire any bonds payable or repurchase any of its own common stock. The following questions pertain to the company's statement of cash flows. The net cash provided by (used in) operating activities for the year was:

Paying taxes to governmental bodies is considered a cash outflow in the operating activities section on the statement of cash flows.

Salsedo Corporation's balance sheet and income statement appear below: Cash dividends were $9. The company sold equipment for $15 that was originally purchased for $10 and that had accumulated depreciation of $5. It did not issue any bonds payable or repurchase any of its own common stock. The net cash provided by (used in) investing activities for the year was: