Filters
Question type
Study Flashcards

A company reported beginning plant assets, net of depreciation, of $734,550; and, an ending amount of $658,000. Depreciation expense of $50,400 and a loss on the sale of equipment of $5600 were reported on the income statement. The company acquired $215,800 of plant assets during the year. How much will be reported as cash received from the sale of equipment in the investing activities section of the statement of cash flows?


A) The cash received upon the sale of the equipment was $241,950.
B) The cash received upon the sale of the equipment was $236,350.
C) The cash received upon the sale of the equipment was $247,550.
D) The cash received upon the sale of the equipment was $286,750.

E) None of the above
F) B) and D)

Correct Answer

verifed

verified

List three ways that owners and investors use the statement of cash flows.

Correct Answer

verifed

verified

a. The statement of cash flows is used t...

View Answer

The following data relate to Sorrentino Corporation for last year: The following data relate to Sorrentino Corporation for last year: What is the net cash provided by operating activities for last year on the statement of cash flows for Sorrentino Corporation? A) $229,000 B) $171,800 C) $151,800 D) $211,800 What is the net cash provided by operating activities for last year on the statement of cash flows for Sorrentino Corporation?


A) $229,000
B) $171,800
C) $151,800
D) $211,800

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

Correct Answer

verifed

verified

Computing cash generated from operating activities is


A) the same for both the direct and indirect methods.
B) different because the indirect method considers depreciation.
C) different in that the direct method considers depreciation.
D) none of the above.

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

Correct Answer

verifed

verified

The only difference in a statement of cash flows prepared under the direct method as opposed to the indirect method is the presentation of investing activities.

A) True
B) False

Correct Answer

verifed

verified

When using the indirect method in the statement of cash flows, the company would add the net change in a current liability account if the balance increased over time.

A) True
B) False

Correct Answer

verifed

verified

All of the following would be done when calculating the change in cash from operating activities under the indirect method except


A) deduct the purchase of equipment.
B) add an increase in accrued interest payable.
C) add a decrease in merchandise inventory.
D) deduct a decrease in accounts payable.

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

Correct Answer

verifed

verified

The ________ reports an entity's cash receipts and cash payments during the period.


A) income statement
B) statement of retained earnings
C) balance sheet
D) statement of cash flows

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

Correct Answer

verifed

verified

Which of the activities sections of the statement of cash flows would include a loss of $20,000 from the sale of equipment?


A) Investing
B) Operating
C) Financing
D) Would not be on the statement of cash flows

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

Correct Answer

verifed

verified

A corporation reported net income during the year of $28,500. The following items were reported on the income statement and balance sheet. A corporation reported net income during the year of $28,500. The following items were reported on the income statement and balance sheet. Compute cash flows from operating activities using the indirect method. Compute cash flows from operating activities using the indirect method.

Correct Answer

verifed

verified

Which of the following is an acceptable basis for the preparation of the statement of cash flows?


A) The sum of cash, inventory, and money market accounts
B) The sum of cash and accounts receivable
C) Cash
D) The sum of cash and cash equivalents

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

Correct Answer

verifed

verified

For purposes of the statement of cash flows, "cash" includes cash on hand, cash in the bank and cash equivalents.

A) True
B) False

Correct Answer

verifed

verified

If a company uses the indirect method to prepare the statement of cash flows, how will the adjustment to reflect the amount of cash paid for interest be presented on the statement of cash flows?


A) The adjustment will be for the increase or decrease in accounts receivable during the period and will adjust net income in the operating activities section in the statement of cash flows.
B) The adjustment will be for to reflect the increase or decrease in inventory during the period and will adjust net income in the operating activities section in the statement of cash flows.
C) The adjustment will be for the increase or decrease in accounts payable during the period and will adjust net income in the operating activities section in the statement of cash flows.
D) The adjustment will be for the increase or decrease in interest payable during the period and will adjust net income in the operating activities section in the statement of cash flows.

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

Correct Answer

verifed

verified

A company uses the indirect method to prepare the statement of cash flows. How will a loss from the sale of a building be presented on the statement?


A) A loss from the sale of a building can be an addition in the investing activities section.
B) A loss from the sale of a building can be added to net income in the operating activities section.
C) A loss from the sale of a building can be deducted from net income in the operating activities section.
D) A loss from the sale of a building can be a deduction in the financing activities section.

E) All of the above
F) B) and C)

Correct Answer

verifed

verified

For each of the following transactions indicate the effect on the cash balance. Use + for increase, - for decrease, and 0 for no effect. ________ a. Payment of cash dividends ________ b. Payment of interest ________ c. Sale of treasury stock ________ d. Conversion of debt to common stock ________ e. Payment of accounts payable ________ f. Payment of salaries ________ g. Receipt of cash dividends ________ h. Sale of merchandise for cash ________ i. Acquisition of a patent by issuing common stock ________ j. Purchase of land ________ k. Receipt of stock dividends

Correct Answer

verifed

verified

a. -
b. -
c. +
d. 0
...

View Answer

The direct method of presenting the financing activities section of the statement of cash flows reconciles net income to net cash provided by financing activities.

A) True
B) False

Correct Answer

verifed

verified

If a company uses the indirect method to prepare the statement of cash flows, how will the adjustment to reflect the amount of cash received from customers be presented on the statement?


A) The adjustment will be for the increase or decrease in inventory during the period and will adjust net income in the operating activities section on the statement of cash flows.
B) The adjustment will be for the increase or decrease in accounts payable during the period and will adjust net income in the operating activities section on the statement of cash flows.
C) The adjustment will be for the increase or decrease in accrued expenses during the period and will adjust net income in the operating activities section on the statement of cash flows.
D) The adjustment will be for the increase or decrease in accounts receivable during the period and will adjust net income in the operating activities section on the statement of cash flows.

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

Correct Answer

verifed

verified

Money borrowed for a mortgage would be a(n) ________ activity.


A) operating
B) financing
C) investing
D) non-cash

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

Correct Answer

verifed

verified

A company uses the indirect method to prepare the statement of cash flows. It presents the following data on its financial statements: A company uses the indirect method to prepare the statement of cash flows. It presents the following data on its financial statements: *Relates solely to the acquisition of inventory What will appear in the operating activities section related to accounts payable? A) The increase of $14,000 will be subtracted from net income. B) The increase of $14,000 will be added to net income. C) The increase of $14,000 will be subtracted from cost of goods sold. D) The increase of $14,000 will be added to cost of goods sold. *Relates solely to the acquisition of inventory What will appear in the operating activities section related to accounts payable?


A) The increase of $14,000 will be subtracted from net income.
B) The increase of $14,000 will be added to net income.
C) The increase of $14,000 will be subtracted from cost of goods sold.
D) The increase of $14,000 will be added to cost of goods sold.

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

Correct Answer

verifed

verified

Identify and describe the three sections of the statement of cash flows.

Correct Answer

verifed

verified

a. The operating activities section of t...

View Answer

Showing 21 - 40 of 193

Related Exams

Exam 1

Introduction to Managerial Accounting

201 Questions

Exam 2

Building Blocks of Managerial Accounting

318 Questions

Exam 3

Job Costing

333 Questions

Exam 4

Activity-Based Costing, Lean Operations, and the Costs of Quality

262 Questions

Exam 5

Process Costing

271 Questions

Exam 6

Cost Behavior

307 Questions

Exam 7

Cost-Volume-Profit Analysis

276 Questions

Exam 8

Relevant Costs for Short-Term Decisions

270 Questions

Exam 9

The Master Budget

219 Questions

Exam 10

Performance Evalulation

232 Questions

Exam 11

Standard Costs and Variances

254 Questions

Exam 12

Capital Investment Decisions and the Time Value of Money

213 Questions

Exam 14

Financial Statement Analysis

196 Questions

Exam 15

Sustainability

123 Questions

Show Answer