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Exam 16: Statement of Cash Flows

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Question 21

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Cash flows from investing activities,as part of the statement of cash flows,would include any receipts from the sale of land.

A) True
B) False

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Question 22

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The net income reported on an income statement for the current year was $63,000.Depreciation recorded on fixed assets for the year was $24,000.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 the statement of cash flows using the indirect method.​

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Question 23

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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?

The manner of reporting cash flows from investing and financing activities will be different under the direct method as compared to the indirect method.

The cash flows from operating activities are reported by the direct method on the statement of cash flows.Determine the following:

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

There is no difference in the investing and financing sections of the statement of cash flows using the indirect and direct methods.

To arrive at cash flows from operations,it is necessary to convert the income statement from an accrual basis to the cash basis of accounting.

On the statement of cash flows prepared by the indirect method,a $50,000 gain on the sale of investments would be

Which of the following does not represent an outflow of cash and therefore would not be reported on the statement of cash flows as a use of cash?

Cash,as the term is used for the statement of cash flows,could indicate either cash or cash equivalents.

Financing activities include

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.

If $475,000 of bonds payable are sold at 101,$475,000 would be reported in the Cash flows from financing activities section of the statement of cash flows.

On the basis of the following data for Breach Co.for the current and preceding years ended December 31,prepare a statement of cash flows using the indirect method.Assume that equipment costing $25,000 was purchased for cash and no long-term assets were sold during the period.​Stock was issued for cash-3,200 shares at par.Net income for the current year was $76,000.Cash dividends declared and paid were $13,000.

Which of the following can be found on the statement of cash flows?

Which of the following should be deducted from net income in calculating net cash flow from operating activities using the indirect method?

Cash dividends of $50,000 were declared during the year.Cash dividends payable were $10,000 and $5,000 at the beginning and end of the year,respectively.The amount of cash for the payment of dividends during the year is

Complete each of the columns in the table below,indicating in which section each item would be reported on the statement of cash flows (operating,investing,or financing),the amount that would be reported,and whether the item would create an increase or decrease in cash.For items that affect more than one section of the statement,indicate all affected.Assume the indirect method of reporting cash flows from operating activities.The first item has been completed as an example.

The income statement disclosed the following items for the current year:​​ Balances of the current assets and current liabilities accounts changed between December 31,last year,and December 31,this year,as follows:​​ Prepare the Cash flows from operating activities section of the statement of cash flows using the indirect method.