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Exam 12: Reporting Cash Flows

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Question 71

Multiple Choice

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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 operating activities using the indirect method:

A) $332,200.
B) $236,800.
C) $261,400.
D) $186,800.
E) $189,400.

F) None of the above
G) A) and E)

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Question 72

Multiple Choice

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Activities that involve the production or purchase of merchandise and the sale of goods and services to customers,including expenditures related to administering the business,are classified as:

A) Financing activities.
B) Investing activities.
C) Operating activities.
D) Direct activities.
E) Indirect activities.

F) B) and E)
G) A) and C)

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Question 73

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The statement of cash flows explains the difference between the beginning and ending balances of cash and cash equivalents.

Ford Company reports depreciation expense of $40,000 for Year 2.Also,equipment costing $150,000 was sold for its book value in Year 2.There were no other equipment purchases or sales during the year.The following selected information is available for Ford Company from its comparative balance sheet. -Compute the cash received from the sale of the equipment.

Rowan,Inc.'s,income statement is shown below.Based on this income statement and the other information provided,calculate the net cash provided by operations using the indirect method.

In preparing a company's statement of cash flows for the most recent year,Jeffers Corp.reported the following information: Net cash flows from financing activities for the year were:

Citi Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available: The amount of cash paid for dividends was:

Victoria reported assets of $13,362 million at January 1 and $13,369 million as of December 31 of the current year.Net cash flows from operations were $2,204 million.Calculate the cash flow on total assets ratio.

The purchase of a long-term asset using a long-term note payable is an example of a noncash investing and financing activity,which should be disclosed in a note or separate schedule.

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

All of the following are true regarding the statement of cash flows except:

When preparing the operating activities section of the statement of cash flows using the indirect method,depreciation is added back to net income.

Because the direct method of preparing the statement of cash flows starts with net income,it is the method most frequently used.

To be classified as a cash equivalent,the only criterion an item must meet is that it must be readily convertible to a liquid asset.

Cash flows from collections on credit sales are usually reported in the statement of cash flows as part of:

Financing activities include receiving cash from issuing debt and paying cash dividends to shareholders.

Computing operating cash flows by adjusting accrual-based net income is done when the ________ method is used.

An example of a transaction that must be disclosed as a noncash investing and financing activity includes all but which of the following?

Which of the following is included in the cash flows from financing activities section of the statement of cash flows?

Use the following income statement and information about selected current assets and current liabilities for Kimberline Industries to calculate the net cash provided or used by operating activities using the indirect method. Increases and decreases of current asset and current liability accounts,all of which relate to operating activities,are as follows: