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Exam 14: Statement of Cash Flows

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Question 31

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The net income reported on the income statement for the current year was $275,000. Depreciation recorded on fixed assets and amortization of patents for the year were $40,000 and $9,000, respectively. Balances of current asset and current liability accounts at the end and at the beginning of the year are as follows: What is the amount of cash flows from operating activities reported on the statement of cash flows prepared by the indirect method?

A) $198,000
B) $324,000
C) $352,000
D) $296,000

E) B) and C)
F) A) and D)

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Question 32

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Identify the section of the statement of cash flows a-d) where each of the following items would be reported. -Decrease in inventory

A) Operating activities
B) Financing activities
C) Investing activities
D) Schedule of noncash financing and investing

E) A) and B)
F) B) and D)

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Question 33

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Zenith Corporation sells some of its used store fixtures. The acquisition cost of the fixtures is $12,500 the accumulated depreciation on these fixtures is $9,750 at the time of sale. The fixtures are sold for $5,300. The value of this transaction in the investing section of the statement of cash flows is

To determine cash payments for income taxes for the statement of cash flows using the direct method, an increase in income taxes payable is added to the income tax expense.

Accounts receivable from sales to customers amounted to $40,000 and $32,000 at the beginning and end of the year, respectively. Income reported on the income statement for the year was $110,000. Exclusive of the effect of other adjustments, the net cash flows from operating activities to be reported on the statement of cash flows using the indirect method is

Sales for the year were $600,000. Accounts receivable were $100,000 and $80,000 at the beginning and end of the year, respectively. Cash received from customers to be reported on the statement of cash flows using the direct method is

Cost of merchandise sold reported on the income statement was $155,000. The accounts payable balance increased $8,000, and the inventory balance increased by $21,000 over the year. Determine the amount of cash paid for merchandise.

Connor Designs Company has cash flows for operating activities of $425,000. Cash flows used for investments in property, plant, and equipment totaled $65,000, of which 70% of this investment was used to replace machinery to maintain existing capacity. What is the free cash flow for Connor Designs?

The following information is available from the current period financial statements:

If a gain of $11,000 is realized in selling for cash) office equipment having a book value of $55,000, the total amount reported in the cash flows from investing activities section of the statement of cash flows is

For each of the following activities that may take place during the accounting period, indicate the effect a-g) on the statement of cash flows prepared using the indirect method. Choices may be selected as the answer for more than one question. -repayment of long-term note payable

When using the spreadsheet work sheet) for the statement of cash flows, indirect method, entries made on the spreadsheet are

Accounts receivable from sales transactions were $51,000 at the beginning of the year and $64,000 at the end of the year. Net income reported on the income statement for the year was $105,000. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows prepared by the indirect method is

Durrand Corporation's accumulated depreciation increased by $12,000, while patents decreased by $2,200 between consecutive balance sheet dates. There were no purchases or sales of depreciable or intangible assets during the year. In addition, the income statement showed a gain of $4,300 from sale of land. Reconcile a net income of $65,000 to net cash flow from operating activities.

Depreciation on factory equipment would be reported in the statement of cash flows prepared by the indirect method in

The cash flows from operating activities are reported by the direct method on the statement of cash flows. 1)2)Determine the following: If sales for the current year were $695,000 and accounts receivable decreased by $43,500 during the year, what was the amount of cash received from customers? If income tax expense for the current year was $56,000 and income tax payable decreased by $5,200 during the year, what was the amount of cash payments of income tax?

The cost of merchandise sold during the year was $50,000. Merchandise inventories were $12,500 and $10,500 at the beginning and end of the year, respectively. Accounts payable were $6,000 and $5,000 at the beginning and end of the year, respectively. Using the direct method of reporting cash flows from operating activities, cash payments for merchandise total

Indicate whether each of the following would be added to or deducted from net income in determining net cash flow from operating activities by the indirect method: a) Increase in prepaid expenses b) Amortization of patents c) Increase in salaries payable d) Gain on sale of fixed assets e) Decrease in accounts receivable f) Increase in notes receivable due in 60 days g) Amortization of discount on bonds payable h) Decrease in merchandise inventory i) Depreciation of fixed assets j) Loss on retirement of long-term debt k) Decrease in accounts payable l) Increase in notes payable due in 30 days m) Increase in income taxes payable

Net income for the year was $45,500. Accounts receivable increased $5,500, and account payable increased by $11,200. Under the indirect method, the cash flow from operations is

Net income for the year was $29,500. Accounts receivable increased $2,500, and accounts payable increased $5,400. There were no other changes in noncash current assets and liabilities. Under the indirect method, the cash flow from operations is $32,400.