Question 1

Use the following major cash flow activities to classify the activities listed below:
-Payment of cash dividends

Accepted Answer

A) Operating Activity, Source of Cash 
B) Operating Activity, Use of Cash 
C) Investing Activity, Source of Cash 
D) Investing Activity, Use of Cash 
E) Financing Activity, Source of Cash
F)Financing Activity, Use of Cash
G)Non-cash Investing & Financing Activity

Question 2

Use the following major cash flow activities to classify the activities listed below:
-Issued Common Stock for cash

Accepted Answer

A) Operating Activity, Source of Cash 
B) Operating Activity, Use of Cash 
C) Investing Activity, Source of Cash 
D) Investing Activity, Use of Cash 
E) Financing Activity, Source of Cash
F)Financing Activity, Use of Cash
G)Non-cash Investing & Financing Activity

Question 3

Which of the following would be subtracted from net income using the indirect method?

Accepted Answer

A)  an increase in inventories. 
B)  loss on sale of investments. 
C)  depreciation expense. 
D)  a decrease in accounts payable.

Question 4

The data given below are from the accounting records of Kain Company:  Based on this information, the net cash flows from operating activities on the statement of cash flows using the indirect method would be

Accepted Answer

A)  $51,300. 
B)  $50,000. 
C)  $42,100. 
D)  $44,700.

Question 5

Land costing $78,000 was sold for $93,000 cash. The gain on the sale was reported on the income statement as other income. On the statement of cash flows, what amount should be reported as an investing activity from the sale of land?

Accepted Answer

A)  $78,000 
B)  $108,000 
C)  $93,000 
D)  $15,000

Question 6

Dolan Company's income statement showed revenues of $250,000 and operating expenses of $160,000. Accounts receivable decreased by $60,000 and accounts payable increased by $40,000 during the year.
Required: Compute (A) cash receipts from customers and (B) cash payments for operating expenses using the direct method.

Accepted Answer

The answer of Dolan Company's income statement showed revenues of...

Question 7

A comparative balance sheet for the Bright Corporation is presented below:
  Additional information:
  Required: Prepare a statement of cash flows for the year ended 2014 using the indirect method.

Accepted Answer

The answer of A comparative balance sheet for the Bright...

Question 8

Use the following major cash flow activities to classify the activities listed below:
-Paid off long-term debt

Accepted Answer

A) Operating Activity, Source of Cash 
B) Operating Activity, Use of Cash 
C) Investing Activity, Source of Cash 
D) Investing Activity, Use of Cash 
E) Financing Activity, Source of Cash
F)Financing Activity, Use of Cash
G)Non-cash Investing & Financing Activity

Question 9

In preparing the statement of cash flows, determining the net increase or decrease to cash requires the use of

Accepted Answer

A)  the adjusted trial balance. 
B)  the current period's retained earnings statement. 
C)  a comparative balance sheet. 
D)  a comparative income statement.

Question 10

Cash flows from acquiring and selling equipment are classified as

Accepted Answer

A)  operating activities. 
B)  investing activities. 
C)  financing activities. 
D)  distribution activities.

Question 11

Which balance sheet accounts are affected by financing activities?

Accepted Answer

A)  current assets and current liabilities. 
B)  long-term assets. 
C)  long-term liabilities. 
D)  intangible assets.

Question 12

The indirect method of reporting the cash flows from operating activities on the statement of cash flows is the method most widely used in practice.

Accepted Answer

A) True 
 B)False

Question 13

If an asset is sold at a gain, why is the gain deducted from net income when computing the net cash flows from operating activities under the indirect method?

Accepted Answer

The answer of If an asset is sold at a...

Question 14

Cash flows from operating activities can be calculated using the indirect or direct method. Briefly describe how the two methods differ yet arrive at the same information about the net cash flows from operating activities.

Accepted Answer

The answer of Cash flows from operating activities can be...

Question 15

The general ledger of Lopez Company provides the following information:
  Net sales for the year were $2,100,000 and cost of goods sold were $1,500,000.
Required: Compute the following:

Accepted Answer

The answer of The general ledger of Lopez Company provides...

Question 16

Last year Kinslow Company's cash account increased by $16,000. Net cash flows from investing activities were ($39,000). Net cash flows from financing activities were $17,000. On the statement of cash flows, the net cash flows from operating activities were

Accepted Answer

A)  $(22,000). 
B)  $38,000. 
C)  $(6,000). 
D)  $16,000.

Question 17

________________ are the ongoing, day-to-day, revenue-generating activities of an organization.

Accepted Answer

The answer of ________________ are the ongoing, day-to-day, revenue-generating activities...

Question 18

Cash flows from operating activities, as reported on the statement of cash flows, would include

Accepted Answer

A)  depreciation. 
B)  gain on sale of equipment 
C)  increase in accounts receivable. 
D)  All of these.

Question 19

If a gain of $25,000 is incurred in selling (for cash) office equipment having a book value of $100,000, the total amount reported in the cash flows from the investing activities section of the statement of cash flows is

Accepted Answer

A)  $75,000. 
B)  $100,000. 
C)  $125,000. 
D)  $25,000.

Question 20

For each of the following items, indicate by using the appropriate code letter, how the item should be reported in the statement of cash flows, using the indirect method.
-Decrease in accounts receivable during a period.

Accepted Answer

A) Added to net income 
B) Deducted from net income 
C) Cash outflow--investing activity 
D) Cash inflow--investing activity 
E) Cash outflow--financing activity
F)Cash inflow--financing activity
G)significant noncash investing and financing activity

Exam 15: Statement of Cash Flows

Use the following major cash flow activities to classify the activities listed below: -Payment of cash dividends

Use the following major cash flow activities to classify the activities listed below: -Issued Common Stock for cash

Which of the following would be subtracted from net income using the indirect method?

The data given below are from the accounting records of Kain Company: Based on this information, the net cash flows from operating activities on the statement of cash flows using the indirect method would be

Land costing $78,000 was sold for $93,000 cash. The gain on the sale was reported on the income statement as other income. On the statement of cash flows, what amount should be reported as an investing activity from the sale of land?

A comparative balance sheet for the Bright Corporation is presented below: Additional information: Required: Prepare a statement of cash flows for the year ended 2014 using the indirect method.

Use the following major cash flow activities to classify the activities listed below: -Paid off long-term debt

In preparing the statement of cash flows, determining the net increase or decrease to cash requires the use of

Cash flows from acquiring and selling equipment are classified as

Which balance sheet accounts are affected by financing activities?

The indirect method of reporting the cash flows from operating activities on the statement of cash flows is the method most widely used in practice.

If an asset is sold at a gain, why is the gain deducted from net income when computing the net cash flows from operating activities under the indirect method?

Cash flows from operating activities can be calculated using the indirect or direct method. Briefly describe how the two methods differ yet arrive at the same information about the net cash flows from operating activities.

The general ledger of Lopez Company provides the following information: Net sales for the year were $2,100,000 and cost of goods sold were $1,500,000. Required: Compute the following:

Last year Kinslow Company's cash account increased by $16,000. Net cash flows from investing activities were ($39,000) . Net cash flows from financing activities were $17,000. On the statement of cash flows, the net cash flows from operating activities were

________________ are the ongoing, day-to-day, revenue-generating activities of an organization.

Cash flows from operating activities, as reported on the statement of cash flows, would include

If a gain of $25,000 is incurred in selling (for cash) office equipment having a book value of $100,000, the total amount reported in the cash flows from the investing activities section of the statement of cash flows is

For each of the following items, indicate by using the appropriate code letter, how the item should be reported in the statement of cash flows, using the indirect method. -Decrease in accounts receivable during a period.