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Exam 13: Statement of Cash Flows

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Question 71

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Identify the section of the statement of cash flows a-d where each of the following items would be reported. -Dividends received on investment

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

E) All of the above
F) A) and D)

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Question 72

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Under the direct method of preparing a statement of cash flows, the gain on the sale of land is not adjusted or reported as part of cash flows from operating activities.

A) True
B) False

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Question 73

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To determine cash payments for operating expenses for the statement of cash flows using the direct method, a decrease in accrued expenses is added to operating expenses payable other than depreciation.

Using the indirect method, if land costing $85,000 was sold for $145,000, the amount reported in the financing activities section of the statement of cash flows would be $85,000.

The statement of cash flows is not one of the basic financial statements.

The cash flows from operating activities are reported by the direct method on the statement of cash

On the statement of cash flows prepared by the indirect method, the cash flows from operating activities section would include

The statement of cash flows reports a firm's major sources of cash receipts and major uses of cash for a period of time.

Identify the section of the statement of cash flows a-d where each of the following items would be reported. -Payment of dividends to stockholders

A building with a book value of $54,000 is sold for $63,000 cash.Using the indirect method, this transaction should be shown on the statement of cash flows as follows:

A ten-year bond was issued at par for $250,000 cash.This transaction should be shown on a statement of cash flows under

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

On the statement of cash flows, the cash flows from operating activities section would include

For each of the following, identify whether it would be disclosed as an operating O, financing F, or investing I activity on the statement of cash flows under the indirect method. a.____purchased treasury stock b.____sold equipment at book value c.____net income d.____sold long-term investments e.____issued common stock f.____depreciation expense

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. -payment of dividends

Which of the following is not one of the four basic financial statements?

Samuel Company's accumulated depreciation-equipment increased by $6,000, while patents decreased by $2,200 between balance sheet dates.There were no purchases or sales of depreciable or intangible assets during the year.In addition, the income statement showed a loss of $3,200 from the sale of investments.Assume no changes in noncash current assets and liabilities. Reconcile a net income of $92,000 to net cash flow from operating activities.

The net income reported on the income statement for the current year was $58,000.Depreciation recorded on fixed assets for the year was $24,000.In addition, equipment with an original cost of $130,000 and accumulated depreciation of $115,000 on the date of the sale, was sold for $20,000.Balances of the current asset and current liability accounts at the end and beginning of the year are listed below.Prepare the cash flows from operating activities section of a statement of cash flows using the indirect method.

Land costing $71,000 was sold for $50,000 cash.The loss on the sale was reported on the income statement as other expense.On the statement of cash flows, what amount should be reported as an investing activity from the sale of land?

Free cash flow is flow cash from operations less cash used for