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Exam 13: Statement of Cash Flows

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Question 81

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When preparing the statement of cash flows using the indirect method,losses from investing activities are deducted from net income to arrive at cash flows from operating activities.

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Question 82

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Which of the following is not a source of cash?

A) Dividends received on investment
B) Borrowing $5,000 on short-term note
C) Gain on sale of warehouse
D) All of these answer choices are sources of cash

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Question 83

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In preparing cash flows provided by operating activities using the indirect method,which of the following items is added to net income?

Benton Corporation's current asset and liability balances for the past two years are as follows.Net income for the year was $150,000,depreciation expense was $22,000,and gain on sale of land was $28,000. Required: Using the indirect method,prepare the cash flows provided by operating activities section of the statement of cash flows.

Using the direct method of preparing the statement of cash flows,to determine the cash effects of operating activities,a gain on the sale of equipment would be

Which of the following cash flows results from an operating activity?

Parker Corporation provided the following financial information: Required: Using the direct method,prepare the operating activities section of Parnell's statement of cash flows. Appendix,

Myers Industries reported sales of $220,000 on its income statement.During the year,accounts receivable increased by $25,000 and accounts payable decreased by $15,000.Maddox uses the direct method to determine the net cash provided by operating activities on the statement of cash flows.What is the amount of sales revenue adjusted to a cash basis for the year?

Answer the following questions related to the investing and financing sections of the statement of cash flows. a.In which balance sheet accounts are investing activities recorded? b.In which balance sheet accounts are financing activities recorded? c.When a gain or loss is recorded on the sale of an asset,what amount is shown in the investing section of the statement of cash flows? Unit 13-3,

Which of the following items would not be included in the calculation of cash flows provided by operating activities using the indirect method?

Wil Wheaton,Kirk Enterprises' controller,is preparing the financial statements for 2016.He has completed the comparative balance sheets and income statement,which follow,and has gathered this additional information: $\bullet$ On December 31,2016,Kirk sold a piece of equipment with an original cost of $25,000 for $10,000 cash.The equipment had a book value of $13,000. $\bullet$ On February 1,2016,Kirk issued $60,000 of common stock to raise cash in anticipation of the purchase of a new building later in the year. $\bullet$ On February 2,2016,Kirk took out a ten-year $110,000 long-term loan to provide the remaining funds needed to purchase the building. $\bullet$ On May 15,2016,Kirk paid $162,000 for the new building. $\bullet$ The company paid a cash dividend of $9,500. Required: Using the direct method,prepare Kirk Enterprises' statement of cash flows for 2016.

On the cash flow statement,the gain on the sale of a delivery truck is an investing activity.

According to the 2011 edition of Accounting Trends and Techniques,approximately what percentage of companies use the indirect method to report cash flows provided by operating activities?

In preparing cash flows provided by operating activities using the indirect method,which of the following items is added to net income?

During the current year,Maddox Industries sold a delivery truck with a book value of $5,000 for $15,000,declared and paid cash dividends of $8,000 and borrowed $50,000 from First National Bank.Maddox's net cash flows provided by investing activities is

When a company sells equipment for cash,which of the following is the correct reporting on the statement of cash flows?

For the past two years,Monroe Corporation's statement of cash flows has shown net cash provided by financing activities.Which of the following choices could explain this result?

A company's unearned revenue account increased by $1,000 during the year.Which of the following would appear on the statement of cash flows prepared using the indirect method?

Alma Ortiz prepared Carlee Instruments' balance sheet and income statement for 2016.Before she could complete the statement of cash flows,she had to leave town to attend to a family emergency.Because the full set of statements must be provided to the auditors today,Carlee's president,Mike Lymon,has asked you to prepare the statement of cash flows.Lymon has provided you with the balance sheet and income statement that Ortiz prepared,as well as some notes she made: $\bullet$ Equipment with an original cost of $35,000 was sold for $20,300.The book value of the equipment was $19,400. $\bullet$ On June 1,2016,the company purchased new equipment for cash at a cost of $18,500. $\bullet$ At the end of the year the company issued notes payable for $10,500 cash.The note will mature on December 31,2019. $\bullet$ The company paid $20,200 in cash dividends for the year. Required: Using the indirect method,prepare Carlee Instruments' statement of cash flows for 2016.

A company's salaries payable account decreased by $1,000 during the year.Which of the following would appear on the statement of cash flows prepared using the indirect method?