Question 1

A company's income statement showed the following: net income,$134,000; depreciation expense,$30,000; and gain on sale of plant assets,$4,000.An examination of the company's current assets and current liabilities showed the following changes: accounts receivable decreased $9,400; merchandise inventory increased $18,000; prepaid expenses increased $6,200; accounts payable increased $3,400.Calculate the net cash provided or used by operating activities.

Accepted Answer

A)  $156,600.
B)  $141,000.
C)  $96,600.
D)  $148,600.
E)  $88,600.F) A) and C)
G) C) and D) D

Question 2

When preparing the operating activities section of the statement of cash flows using the direct method,revenues and gains with no cash inflows are added back to net income.

Accepted Answer

A) True 
 B)False

Question 3

When using a spreadsheet to prepare the statement of cash flows,an increase in accounts payable is entered in the Analysis of Changes columns with a debit in the statement of cash flows section and a credit in the balance sheet section.

Accepted Answer

A) True 
 B)False

Question 4

Investing activities do not include the:

Accepted Answer

A)  Purchase of plant assets.
B)  Loaning of money in exchange for notes receivable.
C)  Issuance of common stock.
D)  Sale of plant assets.
E)  Sale of short-term investments other than cash equivalents.F) A) and B)
G) A) and C) C

Question 5

The indirect method for the preparation of the operating activities section of the statement of cash flows:

Accepted Answer

A)  Separately lists each major item of operating cash receipts.
B)  Separately lists each major item of operating cash payments.
C)  Reports net income and then adjusts it for items necessary to determine net cash provided or used by operating activities.
D)  Is required if the company is a merchandiser.
E)  Must not be used in all circumstances.F) D) and E)
G) A) and E)

Question 6

A machine with a cost of $130,000 and accumulated depreciation of $85,000 is sold for $40,000 cash.The total amount that should be reported in the operating section of the statement of cash flow as per indirect method is:

Accepted Answer

A)  $17,000.
B)  $4,000.
C)  $57,000.
D)  $21,000.
E)  $5,000.F) C) and D)
G) A) and C)

Question 7

Use the following information about the calendar-year cash flows of Park Company to prepare a statement of cash flows (direct method)and a schedule of noncash investing and financing activities.

Accepted Answer

The answer of Use the following information about the calendar-year...

Question 8

All cash transactions eventually affect noncash ________ accounts.

Accepted Answer

The answer of All cash transactions eventually affect noncash ________...

Question 9

When preparing the operating activities section of the statement of cash flows using the indirect method,decreases in current assets are added back to net income.

Accepted Answer

A) True 
 B)False

Question 10

The statement of cash flows is divided into three sections called the ________,________,and ________ sections.

Accepted Answer

operating; investing...

Question 11

The statement of cash flows is:

Accepted Answer

A)  Another name for the statement of financial position.
B)  A financial statement that presents information about changes in equity during a period.
C)  A financial statement that reports the cash inflows and cash outflows for an accounting period,and that classifies those cash flows as operating activities,investing activities,or financing activities.
D)  A financial statement that lists the types and amounts of assets,liabilities,and equity of a business on a specific date.
E)  A financial statement that lists the types and amounts of the revenues and expenses of a business for an accounting period.F) A) and B)
G) A) and C)

Question 12

When preparing the operating activities section of the statement of cash flows using the indirect method,an increase in income taxes payable is added back to net income.

Accepted Answer

A) True 
 B)False

Question 13

A company reported net income of $318,000,operating cash flows of $218,000,total cash flows of $184,000,and average total assets of $898,000.Calculate its cash flow on total assets ratio.

Accepted Answer

Cash Flow on Total Assets = Op...

Question 14

In preparing a company's statement of cash flows for the most recent year,the following information is available: 
-Net cash flows from investing activities for the year were:

Accepted Answer

A)  $234,000 of net cash used.
B)  $120,000 of net cash provided.
C)  $340,000 of net cash used.
D)  $259,000 of net cash used.
E)  $280,000 of net cash provided.F) A) and B)
G) B) and E)

Question 15

Use the following information about the current year's operations of a company to calculate the cash paid for merchandise.

Accepted Answer

A)  $218,000.
B)  $223,200.
C)  $220,000.
D)  $228,800.
E)  $234,000.F) A) and E)
G) B) and D)

Question 16

Using the direct method,operating cash receipts includes cash received from customers.

Accepted Answer

A) True 
 B)False

Question 17

The appropriate section in the statement of cash flows for reporting the cash payment of wages is:

Accepted Answer

A)  Operating activities.
B)  Financing activities.
C)  Investing activities.
D)  Schedule of noncash investing or financing activity.
E)  This is not reported on the statement of cash flows.F) A) and E)
G) A) and B)

Question 18

The reporting of financing activities in the statement of cash flows is identical under the direct method and indirect method.

Accepted Answer

A) True 
 B)False

Question 19

Northeast Inc.is preparing the company's statement of cash flows for the fiscal year just ended.Using the following information:

-Determine the amount of cash flows from investing activities:

Accepted Answer

A)  ($107,700) .
B)  $107,700.
C)  ($200,000) .
D)  ($139,700) .
E)  ($207,700) .F) A) and B)
G) A) and C)

Question 20

All of the following statements related to reporting cash flows from investing and financing activities are true except:

Accepted Answer

A)  Reporting of financing activities is the same under the direct method and indirect method.
B)  Changes in noncurrent liability accounts and equity accounts are analyzed to determine cash flows from financing activities
C)  Changes in noncurrent asset accounts,current notes receivable,and current investments are analyzed to determine cash flows from investing activities.
D)  The direct method applies accrual accounting while the indirect method applies cash basis accounting.
E)  Reporting of investing activities is the same under the direct method and indirect method.F) B) and C)
G) C) and E) D

Exam 12: Reporting Cash Flows

Correct Answer
verified
D

When preparing the operating activities section of the statement of cash flows using the direct method,revenues and gains with no cash inflows are added back to net income.

Correct Answer
verified

When using a spreadsheet to prepare the statement of cash flows,an increase in accounts payable is entered in the Analysis of Changes columns with a debit in the statement of cash flows section and a credit in the balance sheet section.

Correct Answer
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Investing activities do not include the:

Correct Answer
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C

The indirect method for the preparation of the operating activities section of the statement of cash flows:

Correct Answer
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A machine with a cost of $130,000 and accumulated depreciation of $85,000 is sold for $40,000 cash.The total amount that should be reported in the operating section of the statement of cash flow as per indirect method is:

Correct Answer
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Use the following information about the calendar-year cash flows of Park Company to prepare a statement of cash flows (direct method)and a schedule of noncash investing and financing activities.

Correct Answer
verified

All cash transactions eventually affect noncash ________ accounts.

Correct Answer
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When preparing the operating activities section of the statement of cash flows using the indirect method,decreases in current assets are added back to net income.

Correct Answer
verified

The statement of cash flows is divided into three sections called the ,,and sections.

Correct Answer
verified
operating; investing...
View Answer

The statement of cash flows is:

Correct Answer
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When preparing the operating activities section of the statement of cash flows using the indirect method,an increase in income taxes payable is added back to net income.

Correct Answer
verified

A company reported net income of $318,000,operating cash flows of $218,000,total cash flows of $184,000,and average total assets of $898,000.Calculate its cash flow on total assets ratio.

Correct Answer
verified
Cash Flow on Total Assets = Op...
View Answer

In preparing a company's statement of cash flows for the most recent year,the following information is available: -Net cash flows from investing activities for the year were:

Correct Answer
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Use the following information about the current year's operations of a company to calculate the cash paid for merchandise.

Correct Answer
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Using the direct method,operating cash receipts includes cash received from customers.

Correct Answer
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The appropriate section in the statement of cash flows for reporting the cash payment of wages is:

Correct Answer
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The reporting of financing activities in the statement of cash flows is identical under the direct method and indirect method.

Correct Answer
verified

Northeast Inc.is preparing the company's statement of cash flows for the fiscal year just ended.Using the following information: -Determine the amount of cash flows from investing activities:

Correct Answer
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All of the following statements related to reporting cash flows from investing and financing activities are true except:

Correct Answer
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D

Exam 12: Reporting Cash Flows

Correct AnswerverifiedD

When preparing the operating activities section of the statement of cash flows using the direct method,revenues and gains with no cash inflows are added back to net income.

Correct AnswerverifiedShow Answer

When using a spreadsheet to prepare the statement of cash flows,an increase in accounts payable is entered in the Analysis of Changes columns with a debit in the statement of cash flows section and a credit in the balance sheet section.

Correct AnswerverifiedShow Answer

Investing activities do not include the:

Correct AnswerverifiedC

The indirect method for the preparation of the operating activities section of the statement of cash flows:

Correct AnswerverifiedShow Answer

A machine with a cost of $130,000 and accumulated depreciation of $85,000 is sold for $40,000 cash.The total amount that should be reported in the operating section of the statement of cash flow as per indirect method is:

Correct AnswerverifiedShow Answer

Use the following information about the calendar-year cash flows of Park Company to prepare a statement of cash flows (direct method)and a schedule of noncash investing and financing activities.

Correct AnswerverifiedShow Answer

All cash transactions eventually affect noncash ________ accounts.

Correct AnswerverifiedShow Answer

When preparing the operating activities section of the statement of cash flows using the indirect method,decreases in current assets are added back to net income.

Correct AnswerverifiedShow Answer

The statement of cash flows is divided into three sections called the ________,________,and ________ sections.

Correct Answerverifiedoperating; investing...View AnswerShow Answer

The statement of cash flows is:

Correct AnswerverifiedShow Answer

When preparing the operating activities section of the statement of cash flows using the indirect method,an increase in income taxes payable is added back to net income.

Correct AnswerverifiedShow Answer

A company reported net income of $318,000,operating cash flows of $218,000,total cash flows of $184,000,and average total assets of $898,000.Calculate its cash flow on total assets ratio.

Correct AnswerverifiedCash Flow on Total Assets = Op...View AnswerShow Answer

In preparing a company's statement of cash flows for the most recent year,the following information is available: -Net cash flows from investing activities for the year were:

Correct AnswerverifiedShow Answer

Use the following information about the current year's operations of a company to calculate the cash paid for merchandise.

Correct AnswerverifiedShow Answer

Using the direct method,operating cash receipts includes cash received from customers.

Correct AnswerverifiedShow Answer

The appropriate section in the statement of cash flows for reporting the cash payment of wages is:

Correct AnswerverifiedShow Answer

The reporting of financing activities in the statement of cash flows is identical under the direct method and indirect method.

Correct AnswerverifiedShow Answer

Northeast Inc.is preparing the company's statement of cash flows for the fiscal year just ended.Using the following information: -Determine the amount of cash flows from investing activities:

Correct AnswerverifiedShow Answer

All of the following statements related to reporting cash flows from investing and financing activities are true except:

Correct AnswerverifiedD

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D

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C

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Correct Answer
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Correct Answer
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Correct Answer
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The statement of cash flows is divided into three sections called the ,,and sections.

Correct Answer
verified
operating; investing...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Cash Flow on Total Assets = Op...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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D