Question 1

The indirect method for preparation of the operating activities section of the statement of cash flows involves adjustments

Accepted Answer

A) For income statement items involving operating activities that do not affect cash inflows or outflows 
B) To eliminate gains and losses resulting from investing and financing activities 
C) For changes in noncash current assets and current liabilities 
D) For income statement items involving operating activities that do not affect cash inflows or outflows and for changes in noncash current assets and current liabilities 
E) All of these 
A) For income statement items involving operating activities that do not affect cash inflows or outflows 
B) To eliminate gains and losses resulting from investing and financing activities 
C) For changes in noncash current assets and current liabilities 
D) For income statement items involving operating activities that do not affect cash inflows or outflows and for changes in noncash current assets and current liabilities 
E) All of these E

Question 2

The statement of cash flows explains how transactions and events impact the end-of-period cash balance to produce the end-of-period cash balance.

Accepted Answer

A) True 
 B)False  False

Question 3

Examples of transactions that must be disclosed as noncash investing and financing activities include

Accepted Answer

A) The conversion of debt securities to equity securities 
B) The purchase of non-current assets financed by a cash down payment and a note payable to the seller for the balance 
C) The leasing of assets in a transaction that qualifies as a finance lease 
D) The purchase of noncash assets in exchange for equity or debt securities 
E) All of these 
A) The conversion of debt securities to equity securities 
B) The purchase of non-current assets financed by a cash down payment and a note payable to the seller for the balance 
C) The leasing of assets in a transaction that qualifies as a finance lease 
D) The purchase of noncash assets in exchange for equity or debt securities 
E) All of these E

Question 4

Preparation of the statement of cash flows involves

Accepted Answer

A) Calculation of the net increase or decrease in cash 
B) Calculation and reporting of net cash provided or used by operating activities 
C) Calculation and reporting of net cash provided or used by investing activities 
D) Calculation and reporting of net cash provided or used by financing activities 
E) All of these 
A) Calculation of the net increase or decrease in cash 
B) Calculation and reporting of net cash provided or used by operating activities 
C) Calculation and reporting of net cash provided or used by investing activities 
D) Calculation and reporting of net cash provided or used by financing activities 
E) All of these

Question 5

Deena Inc.reported $32,000 of cash provided by operating activities and the following data: $\begin{array}{|l|r|}
\hline \text { Depreciation Expense } & \$ 34,000 \
\hline \text { Increase in accounts payable } & 9,000 \
\hline \text { Increase in wages payable } & 18,000 \
\hline \text { Increase in accounts receivable } & 9,000 \
\hline \text { Decrease in dividends payable } & 2,000 \
\hline
\end{array}$ Deena's profit/loss for the period was

Accepted Answer

A) $30,000 profit 
B) $18,000 loss 
C) $20,000 loss 
D) $36,000 loss 
A) $30,000 profit 
B) $18,000 loss 
C) $20,000 loss 
D) $36,000 loss

Question 6

Genesis reported that bonds with a face value of $100,000 and a carrying value of $67,000 are retired for $60,000 cash,resulting in a loss of $7,000.The amount to be reported in the financing section is

Accepted Answer

A) $(3,000) 
B) $57,000 
C) $58,000 
D) $60,000 
E) This item is not reported 
A) $(3,000) 
B) $57,000 
C) $58,000 
D) $60,000 
E) This item is not reported

Question 7

Using the indirect method to calculate net cash provided (or used)by operating activities,which of the following is subtracted from profit?

Accepted Answer

A) Depreciation expense 
B) Amortization of intangible assets 
C) Decrease in income taxes payable 
D) Bad debts expense 
E) None of these 
A) Depreciation expense 
B) Amortization of intangible assets 
C) Decrease in income taxes payable 
D) Bad debts expense 
E) None of these

Question 8

Use the information provided about the current year operations of Upper Down Company to calculate cash paid for merchandise.

Accepted Answer

A) $110,800 
B) $111,200 
C) $111,600 
D) $112,800 
E) $112,900 
A) $110,800 
B) $111,200 
C) $111,600 
D) $112,800 
E) $112,900

Question 9

Muhulland Corp had the following financial data related to the years ended December 31:
   Determine the 2021 cash flows from operating activities using the indirect method.

Accepted Answer

The answer of Muhulland Corp had the following financial data...

Question 10

From the following information,calculate the net cash provided (or used)by investing activities:

Accepted Answer

Cash flows

Question 11

The proceeds from the disposal of property,plant and equipment are reported on the statement of cash flows as cash used by investing activities.

Accepted Answer

A) True 
 B)False

Question 12

Troll Corp had the following financial data related to the years ended December 31:
     Prepare a statement of cash flows for the year ended December 31,2021,using the indirect method.

Accepted Answer

The answer of Troll Corp had the following financial data...

Question 13

A loss on the disposal of a non-current asset

Accepted Answer

A) Involves cash inflows 
B) Involves cash outflows 
C) Does not reflect any cash flow 
D) Is the result of an investing activity 
E) Does not reflect any cash flow and is the result of an investing activity 
A) Involves cash inflows 
B) Involves cash outflows 
C) Does not reflect any cash flow 
D) Is the result of an investing activity 
E) Does not reflect any cash flow and is the result of an investing activity

Question 14

Explain how the cash flows from operating activities in the statement of cash flows is prepared using the direct method.

Accepted Answer

The direct method for reporting net cash

Question 15

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

Accepted Answer

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

Question 16

Managers use cash flow predictions to

Accepted Answer

A) Make decisions about acquiring new property,plant and equipment 
B) Insource or outsource production of a product 
C) Keep or eliminate a product line 
D) Maintain or downsize a department 
E) All of these 
A) Make decisions about acquiring new property,plant and equipment 
B) Insource or outsource production of a product 
C) Keep or eliminate a product line 
D) Maintain or downsize a department 
E) All of these

Question 17

Sully Co.had the following financial data related to the year ended December 31:
   Additional information:
   Prepare a statement of cash flows for calendar 2021 using the indirect method.

Accepted Answer

The answer of Sully Co.had the following financial data related...

Question 18

The statement of cash flows reports

Accepted Answer

A) Operating activities 
B) Financing activities 
C) Investing activities 
D) Noncash financing and investing activities 
E) All of these 
A) Operating activities 
B) Financing activities 
C) Investing activities 
D) Noncash financing and investing activities 
E) All of these

Question 19

Internal users of the statement of cash flows use cash flow information to plan day-to-day operating activities and make non-current investments.

Accepted Answer

A) True 
 B)False

Question 20

The purpose of the statement of cash flows is to report the major items comprising cash receipts and cash payments during a period.

Accepted Answer

A) True 
 B)False

The indirect method for preparation of the operating activities section of the statement of cash flows involves adjustments

The statement of cash flows explains how transactions and events impact the end-of-period cash balance to produce the end-of-period cash balance.

Examples of transactions that must be disclosed as noncash investing and financing activities include

Preparation of the statement of cash flows involves

Genesis reported that bonds with a face value of $100,000 and a carrying value of $67,000 are retired for $60,000 cash,resulting in a loss of $7,000.The amount to be reported in the financing section is

Using the indirect method to calculate net cash provided (or used)by operating activities,which of the following is subtracted from profit?

Use the information provided about the current year operations of Upper Down Company to calculate cash paid for merchandise.

Muhulland Corp had the following financial data related to the years ended December 31: Determine the 2021 cash flows from operating activities using the indirect method.

From the following information,calculate the net cash provided (or used)by investing activities:

The proceeds from the disposal of property,plant and equipment are reported on the statement of cash flows as cash used by investing activities.

Troll Corp had the following financial data related to the years ended December 31: Prepare a statement of cash flows for the year ended December 31,2021,using the indirect method.

A loss on the disposal of a non-current asset

Explain how the cash flows from operating activities in the statement of cash flows is prepared using the direct method.

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

Managers use cash flow predictions to

Sully Co.had the following financial data related to the year ended December 31: Additional information: Prepare a statement of cash flows for calendar 2021 using the indirect method.

The statement of cash flows reports

Internal users of the statement of cash flows use cash flow information to plan day-to-day operating activities and make non-current investments.

The purpose of the statement of cash flows is to report the major items comprising cash receipts and cash payments during a period.

Property, plant and Equipment Intangibles

Current Liabilities

Partnerships

Organization and Operation of Corporations

Corporate Reporting: Income, earnings Per Share, and Retained Earnings

Bonds and Long-Term Notes Payable

Accounting for Debt and Share Investments

Analyzing Financial Statements

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Exam 8: Reporting and Analyzing Cash Flows

The indirect method for preparation of the operating activities section of the statement of cash flows involves adjustments

The statement of cash flows explains how transactions and events impact the end-of-period cash balance to produce the end-of-period cash balance.

Examples of transactions that must be disclosed as noncash investing and financing activities include

Preparation of the statement of cash flows involves

Genesis reported that bonds with a face value of $100,000 and a carrying value of $67,000 are retired for $60,000 cash,resulting in a loss of $7,000.The amount to be reported in the financing section is

Using the indirect method to calculate net cash provided (or used)by operating activities,which of the following is subtracted from profit?

Use the information provided about the current year operations of Upper Down Company to calculate cash paid for merchandise.

Muhulland Corp had the following financial data related to the years ended December 31: Determine the 2021 cash flows from operating activities using the indirect method.

From the following information,calculate the net cash provided (or used)by investing activities:

The proceeds from the disposal of property,plant and equipment are reported on the statement of cash flows as cash used by investing activities.

Troll Corp had the following financial data related to the years ended December 31: Prepare a statement of cash flows for the year ended December 31,2021,using the indirect method.

A loss on the disposal of a non-current asset

Explain how the cash flows from operating activities in the statement of cash flows is prepared using the direct method.

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

Managers use cash flow predictions to

Sully Co.had the following financial data related to the year ended December 31: Additional information: Prepare a statement of cash flows for calendar 2021 using the indirect method.

The statement of cash flows reports

Internal users of the statement of cash flows use cash flow information to plan day-to-day operating activities and make non-current investments.

The purpose of the statement of cash flows is to report the major items comprising cash receipts and cash payments during a period.

Property, plant and Equipment Intangibles

Current Liabilities

Partnerships

Organization and Operation of Corporations

Corporate Reporting: Income, earnings Per Share, and Retained Earnings

Bonds and Long-Term Notes Payable

Accounting for Debt and Share Investments

Analyzing Financial Statements

Filters