Exam 12: The Statement of Cash Flows

When using the direct method,how is the retirement of bonds payable at their maturity date shown on the statement of cash flows?

Under the indirect method,instead of reporting cash receipts and payments,net income is reconciled with net cash from operating activities.

Upon review of Jerry's Canoe Gallery statement of cash flows,the following was noted: From this information,the most likely explanation is that Jerry is

In terms of the statement of cash flows,cash includes actual cash items plus certain cash equivalents such as commercial paper,money market funds,and Treasury bills.

Which of the following statements regarding the statement of cash flows is true?

The statement of cash flows emphasizes explanations for the change in net income.

Phoenix Corp.reported the following information for 2013 and 2014. How much cash was paid for interest during 2014?

Use the information below for Oakland Inc.for 2013 and 2014 to answer the following question. During 2014,Oakland Inc.sold equipment with a cost of $30,000 and accumulated depreciation of $25,000.A gain of $3,000 was recognized on the sale of the equipment This was the only equipment sale during the year. What was depreciation expense for 2014?

Which of the following operating activities results in a cash outflow?

When using the indirect method,how would the retirement of bonds payable at their maturity date be shown on the statement of cash flows?

At the end of the first year of operations,the balance sheet of West Palm Beach Industries had the following balances: Accounts Receivable,$5,000;Accounts Payable,$6,000;Inventory,$3,000;and Unexpired Insurance,$2,000.The corporation reported net income of $79,000 for the year,including depreciation expense of $5,000,and uses the indirect method of computing net cash flow from operating activities.Based on this information,net cash flow from operating activities is:

Use the selected information from the statement of cash flows for three actual companies for the last three years to answer the questions that follow. REQUIRED: Ignoring the differences in magnitude,comment on the similarities and differences in the cash flows of the three companies.

Is it logical that interest paid is classified as a cash outflow in the Operating Activities section of the statement of cash flows but that dividends paid are included in the Financing Activities section? Explain.

Stein Corp.reported the following information for 2013 and 2014. How much cash was paid for merchandise purchases during 2014?

The following items were reported on the balance sheets and income statement for Kensington Co.: What amount would be reported in the operating activities section of the statement of cash flows for collections from customers under the direct method assuming that all sales are on credit?

If the December 31,2012,balance of accounts payable is higher than the January 1,2012,balance,then the amount of cash payments will exceed the purchases on account for the year.

Net income was $ 61,000 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 $47,000.

If a company reports a net loss for the year,is it still possible that cash could actually increase during the year? Explain your answer.

Which of the following is an addition to net income when the indirect method is used?

When using the direct method,how is the collection of cash from customers shown on the statement of cash flows?