Question 1

Both the direct and indirect methods yield the identical net cash flow amount provided or used by operating activities.

Accepted Answer

A) True 
 B)False  True

Question 2

When analyzing the changes on a spreadsheet used to prepare a statement of cash flows,the cash flows from operating activities generally affect:

Accepted Answer

A) Net income,current assets,and current liabilities. 
B) Noncurrent assets. 
C) Noncurrent liability and equity accounts. 
D) Both noncurrent assets and noncurrent liabilities. 
E) Equity accounts only. 
A) Net income,current assets,and current liabilities. 
B) Noncurrent assets. 
C) Noncurrent liability and equity accounts. 
D) Both noncurrent assets and noncurrent liabilities. 
E) Equity accounts only. A

Question 3

________ activities include the cash effects of transactions and events that determine net income.

Accepted Answer

Operating

Question 4

The accountant for Huckleberry Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available:   What is the ending balance for retained earnings?

Accepted Answer

A) $264,000. 
B) $13,000. 
C) $243,000. 
D) $197,000. 
E) $105,000. 
A) $264,000. 
B) $13,000. 
C) $243,000. 
D) $197,000. 
E) $105,000.

Question 5

Bagwell's net income for the year ended December 31,Year 2 was $175,000.Information from Bagwell's comparative balance sheets is given below.Compute the cash paid for dividends during Year 2. $\begin{array}{lrr}
\text { At December } 31 & \text { Year 2 } & \text { Year } 1 \
\text { Common Stock, \$5 par value } & \$ 500,000 & \$ 450,000 \
\text { Paid-in capital in excess of par } & 948,000 & 853,000 \
\text { Retained earnings } & 688,000 & 582,000
\end{array}$

Accepted Answer

A) $79,000. 
B) $201,000. 
C) $95,000. 
D) $50,000. 
E) $69,000. 
A) $79,000. 
B) $201,000. 
C) $95,000. 
D) $50,000. 
E) $69,000.

Question 6

A noncash investing transaction should be disclosed in either a footnote or at the bottom of the statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 7

The appropriate section in the statement of cash flows for reporting the issuance of common stock for cash is:

Accepted Answer

A) Operating activities. 
B) Financing activities. 
C) Investing activities. 
D) Schedule of noncash investing or financing activity. 
E) This is not reported on the statement of cash flows. 
A) Operating activities. 
B) Financing activities. 
C) Investing activities. 
D) Schedule of noncash investing or financing activity. 
E) This is not reported on the statement of cash flows.

Question 8

________ activities include those transactions that affect long-term liabilities and equity.

Accepted Answer

The answer of ________ activities include those transactions that affect...

Question 9

Common uses of the statement of cash flows include all but which of the following?

Accepted Answer

A) Management prediction of future cash flows for decision making. 
B) Investor assessment of cash flows before buying and selling stock. 
C) Creditor evaluation of a company's ability to generate cash to cover debt. 
D) Government assessment of whether company is able to pay taxes as they become due. 
E) Management determination of the specific sources and uses of cash. 
A) Management prediction of future cash flows for decision making. 
B) Investor assessment of cash flows before buying and selling stock. 
C) Creditor evaluation of a company's ability to generate cash to cover debt. 
D) Government assessment of whether company is able to pay taxes as they become due. 
E) Management determination of the specific sources and uses of cash.

Question 10

When preparing the operating activities section of the statement of cash flows using the indirect method,an increase in accounts receivable is subtracted from net income.

Accepted Answer

A) True 
 B)False

Question 11

Business activities that generate or use cash are classified as operating,investing,or financing activities on the statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 12

A cash-based measure to help business decision makers estimate the amount and timing of cash flows is the cash flow on total assets ratio.

Accepted Answer

A) True 
 B)False

Question 13

Northington,Inc.is preparing the company's statement of cash flows for the fiscal year just ended.Using the following information,determine the amount of cash flows from operating activities using the indirect method:

Accepted Answer

A) $332,200. 
B) $236,800. 
C) $261,400. 
D) $186,800. 
E) $189,400. 
A) $332,200. 
B) $236,800. 
C) $261,400. 
D) $186,800. 
E) $189,400.

Question 14

Use the following information about the current year's operations of a company to calculate the cash paid for merchandise.

Accepted Answer

A) $218,000. 
B) $223,200. 
C) $220,000. 
D) $228,800. 
E) $234,000. 
A) $218,000. 
B) $223,200. 
C) $220,000. 
D) $228,800. 
E) $234,000.

Question 15

Information to prepare the statement of cash flows usually comes from three sources: (1)________,(2)________,and (3)________.

Accepted Answer

comparative balance

Question 16

The reporting of net cash provided or used by operating activities that lists the major items of operating cash receipts,such as receipts from customers,and subtracts the major items of operating cash disbursements,such as cash paid for merchandise,is referred to as the:

Accepted Answer

A) Direct method of reporting net cash provided or used by operating activities. 
B) Cash basis of accounting. 
C) Classified statement of cash flows. 
D) Indirect method of reporting net cash provided or used by operating activities. 
E) Net method of reporting cash flows from operating activities. 
A) Direct method of reporting net cash provided or used by operating activities. 
B) Cash basis of accounting. 
C) Classified statement of cash flows. 
D) Indirect method of reporting net cash provided or used by operating activities. 
E) Net method of reporting cash flows from operating activities.

Question 17

For each of the following separate cases,use the information provided to calculate the missing cash inflow or cash outflow using the direct method.

Accepted Answer

The answer of For each of the following separate cases,use...

Question 18

When preparing a statement of cash flows using the indirect method,which of the following is correct?

Accepted Answer

A) Proceeds from the sale of equipment should be added to net income in the operating activities section. 
B) A loss on the sale of land should be added to net income in the operating activities section. 
C) The declaration of a cash dividend should be a use of cash in the financing activities section. 
D) The issuance of a stock dividend should be a use of cash in the financing activities section. 
E) The purchase of land and a building by issuing a long-term note payable should be a source of cash in the financing activities section. 
A) Proceeds from the sale of equipment should be added to net income in the operating activities section. 
B) A loss on the sale of land should be added to net income in the operating activities section. 
C) The declaration of a cash dividend should be a use of cash in the financing activities section. 
D) The issuance of a stock dividend should be a use of cash in the financing activities section. 
E) The purchase of land and a building by issuing a long-term note payable should be a source of cash in the financing activities section.

Question 19

When preparing the operating section of the statement of cash flows using the indirect method,noncash expenses are ________ net income.

Accepted Answer

The answer of When preparing the operating section of the...

Question 20

The accountant for Crusoe Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available:   What is the ending balance for retained earnings?

Accepted Answer

A) $218,000. 
B) $170,000. 
C) $352,000. 
D) $172,000. 
E) $179,000. 
A) $218,000. 
B) $170,000. 
C) $352,000. 
D) $172,000. 
E) $179,000.

Both the direct and indirect methods yield the identical net cash flow amount provided or used by operating activities.

When analyzing the changes on a spreadsheet used to prepare a statement of cash flows,the cash flows from operating activities generally affect:

________ activities include the cash effects of transactions and events that determine net income.

The accountant for Huckleberry Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available: What is the ending balance for retained earnings?

A noncash investing transaction should be disclosed in either a footnote or at the bottom of the statement of cash flows.

The appropriate section in the statement of cash flows for reporting the issuance of common stock for cash is:

________ activities include those transactions that affect long-term liabilities and equity.

Common uses of the statement of cash flows include all but which of the following?

When preparing the operating activities section of the statement of cash flows using the indirect method,an increase in accounts receivable is subtracted from net income.

Business activities that generate or use cash are classified as operating,investing,or financing activities on the statement of cash flows.

A cash-based measure to help business decision makers estimate the amount and timing of cash flows is the cash flow on total assets ratio.

Northington,Inc.is preparing the company's statement of cash flows for the fiscal year just ended.Using the following information,determine the amount of cash flows from operating activities using the indirect method:

Use the following information about the current year's operations of a company to calculate the cash paid for merchandise.

Information to prepare the statement of cash flows usually comes from three sources: (1),(2),and (3).

The reporting of net cash provided or used by operating activities that lists the major items of operating cash receipts,such as receipts from customers,and subtracts the major items of operating cash disbursements,such as cash paid for merchandise,is referred to as the:

For each of the following separate cases,use the information provided to calculate the missing cash inflow or cash outflow using the direct method.

When preparing a statement of cash flows using the indirect method,which of the following is correct?

When preparing the operating section of the statement of cash flows using the indirect method,noncash expenses are ________ net income.

The accountant for Crusoe Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available: What is the ending balance for retained earnings?

Introducing Financial Statements

Financial Statements and the Accounting System

Adjusting Accounts for Financial Statements

Reporting and Analyzing Merchandising Operations

Reporting and Analyzing Inventories

Reporting and Analyzing Cash,fraud,and Internal Control

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Term Assets

Reporting and Analyzing Current Liabilities

Reporting and Analyzing Long-Term Liabilities

Reporting and Analyzing Equity

Analyzing and Interpreting Financial Statements

Applying Present and Future Values

Investments

International Operations

Filters

Exam 12: Reporting and Analyzing Cash Flows

Both the direct and indirect methods yield the identical net cash flow amount provided or used by operating activities.

When analyzing the changes on a spreadsheet used to prepare a statement of cash flows,the cash flows from operating activities generally affect:

________ activities include the cash effects of transactions and events that determine net income.

The accountant for Huckleberry Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available: What is the ending balance for retained earnings?

A noncash investing transaction should be disclosed in either a footnote or at the bottom of the statement of cash flows.

The appropriate section in the statement of cash flows for reporting the issuance of common stock for cash is:

________ activities include those transactions that affect long-term liabilities and equity.

Common uses of the statement of cash flows include all but which of the following?

When preparing the operating activities section of the statement of cash flows using the indirect method,an increase in accounts receivable is subtracted from net income.

Business activities that generate or use cash are classified as operating,investing,or financing activities on the statement of cash flows.

A cash-based measure to help business decision makers estimate the amount and timing of cash flows is the cash flow on total assets ratio.

Northington,Inc.is preparing the company's statement of cash flows for the fiscal year just ended.Using the following information,determine the amount of cash flows from operating activities using the indirect method:

Use the following information about the current year's operations of a company to calculate the cash paid for merchandise.

Information to prepare the statement of cash flows usually comes from three sources: (1)________,(2)________,and (3)________.

The reporting of net cash provided or used by operating activities that lists the major items of operating cash receipts,such as receipts from customers,and subtracts the major items of operating cash disbursements,such as cash paid for merchandise,is referred to as the:

For each of the following separate cases,use the information provided to calculate the missing cash inflow or cash outflow using the direct method.

When preparing a statement of cash flows using the indirect method,which of the following is correct?

When preparing the operating section of the statement of cash flows using the indirect method,noncash expenses are ________ net income.

The accountant for Crusoe Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available: What is the ending balance for retained earnings?

Introducing Financial Statements

Financial Statements and the Accounting System

Adjusting Accounts for Financial Statements

Reporting and Analyzing Merchandising Operations

Reporting and Analyzing Inventories

Reporting and Analyzing Cash,fraud,and Internal Control

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Term Assets

Reporting and Analyzing Current Liabilities

Reporting and Analyzing Long-Term Liabilities

Reporting and Analyzing Equity

Analyzing and Interpreting Financial Statements

Applying Present and Future Values

Investments

International Operations

Filters

Information to prepare the statement of cash flows usually comes from three sources: (1),(2),and (3).