Question 1

The statement of cash flows reports and proves the net change in cash for a reporting period.

Accepted Answer

A) True 
 B)False  True

Question 2

When using the indirect method to calculate and report the net cash provided or used by operating activities,net income is adjusted for:

Accepted Answer

A) Gains and losses from nonoperating items. 
B) Revenues and expenses that did not provide or use cash. 
C) Changes in noncash current assets and current liabilities related to operating activities. 
D) Changes in current liabilities related to operating activities. 
E) All of the options are correct. 
A) Gains and losses from nonoperating items. 
B) Revenues and expenses that did not provide or use cash. 
C) Changes in noncash current assets and current liabilities related to operating activities. 
D) Changes in current liabilities related to operating activities. 
E) All of the options are correct. E

Question 3

Aster Company's 2013 income statement and changes in selected balance sheet accounts are given below.Calculate the company's net cash provided or used by operating activities using the direct method.
   The company also experienced the following during 2013:

Accepted Answer

The answer of Aster Company's 2013 income statement and changes...

Question 4

The appropriate section in the statement of cash flows for reporting the purchase of equipment for cash is:

Accepted Answer

A) Operating activities. 
B) Financing activities. 
C) Investing activities. 
D) Schedule of noncash investing or financing activity. 
E) None of these.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) None of these.This is not reported on the statement of cash flows.

Question 5

The usual first step in preparing the statement of cash flows is computing the net increase or net decrease in cash.

Accepted Answer

A) True 
 B)False

Question 6

The use of a spreadsheet for analysis is especially useful when preparing the statement of cash flows using the _____________ method.

Accepted Answer

The answer of The use of a spreadsheet for analysis...

Question 7

Explain the purpose and format of the statement of cash flows.Also describe its relevance to decision makers.

Accepted Answer

The purpose of the statement of cash flo

Question 8

The first line item in the operating activities section of a spreadsheet for a statement of cash flows prepared using the indirect method is:

Accepted Answer

A) Cash. 
B) Cash received from customers. 
C) Increase (decrease) in accounts receivable. 
D) Net income. 
E) Adjustments to net income. 
A) Cash. 
B) Cash received from customers. 
C) Increase (decrease) in accounts receivable. 
D) Net income. 
E) Adjustments to net income.

Question 9

The statement of cash flows reports:

Accepted Answer

A) Cash flows from operating activities. 
B) Cash flows from financing activities. 
C) Cash flows from investing activities. 
D) Significant noncash financing and investing activities. 
E) All of the choices are reported on a statement of cash flows. 
A) Cash flows from operating activities. 
B) Cash flows from financing activities. 
C) Cash flows from investing activities. 
D) Significant noncash financing and investing activities. 
E) All of the choices are reported on a statement of cash flows.

Question 10

The indirect method separately lists each major item of operating cash receipts and cash payments.

Accepted Answer

A) True 
 B)False

Question 11

Hancock reported assets of $13,362 million at January 1 and $13,369 million as of December 31 of the current year.Hancock's net cash flows from operations were $2,204 million.Calculate the cash flow on total assets ratio for Hancock.

Accepted Answer

Cash Flow on Total Assets = Ca

Question 12

The accountant for Robinson Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available:
  The amount of cash dividends paid during the year would be:

Accepted Answer

A) $70,000. 
B) $46,000. 
C) $22,000. 
D) $39,000. 
E) $24,000. 
A) $70,000. 
B) $46,000. 
C) $22,000. 
D) $39,000. 
E) $24,000.

Question 13

The cash flow on total assets ratio:

Accepted Answer

A) Is the same as return on assets. 
B) Is the same as profit margin. 
C) Can be an indicator of earnings quality. 
D) Is highly affected by accounting principles of income recognition and measurement. 
E) Is average net assets divided by cash flows from operations. 
A) Is the same as return on assets. 
B) Is the same as profit margin. 
C) Can be an indicator of earnings quality. 
D) Is highly affected by accounting principles of income recognition and measurement. 
E) Is average net assets divided by cash flows from operations.

Question 14

Use the following financial statements and additional information to (1)prepare a statement of cash flows for the year ended December 31,2013 using the indirect method,and (2)compute the company's cash flow on total assets ratio for 2013.
     Additional Information
a.A $20,000 note payable is retired at its carrying value in exchange for cash.
b.The only changes affecting retained earnings are net income and cash dividends paid.
c.New equipment is acquired for $120,000 cash.
d.Received cash for the sale of equipment that had cost $85,000,yielding a gain of $4,700.
e.Prepaid expenses relate to Other Expenses on the income statement.
f.All purchases and sales of merchandise inventory are on credit.

Accepted Answer

(1)
 @#IMG-DLM& (2)$

Question 15

Which of the following items is reported on the statement of cash flows under financing activities?

Accepted Answer

A) Declaration of a cash dividend. 
B) Payment of a cash dividend. 
C) Declaration of a stock dividend. 
D) Payment of a stock dividend. 
E) Stock split. 
A) Declaration of a cash dividend. 
B) Payment of a cash dividend. 
C) Declaration of a stock dividend. 
D) Payment of a stock dividend. 
E) Stock split.

Question 16

The accounting principle that requires important noncash financing and investing activities be reported on the statement of cash flows or in a footnote is the:

Accepted Answer

A) Historical cost principle. 
B) Materiality principle. 
C) Full disclosure principle. 
D) Going concern principle. 
E) Business entity principle. 
A) Historical cost principle. 
B) Materiality principle. 
C) Full disclosure principle. 
D) Going concern principle. 
E) Business entity principle.

Question 17

Which one of the following is representative of typical cash flows from operating activities?

Accepted Answer

A) Proceeds from collecting the principal amounts of loans. 
B) Repayment of principals on loans. 
C) Proceeds from the issuance of bonds and notes payable. 
D) Payments by a merchandiser to acquire equity securities of other companies. 
E) Receipts of cash sales. 
A) Proceeds from collecting the principal amounts of loans. 
B) Repayment of principals on loans. 
C) Proceeds from the issuance of bonds and notes payable. 
D) Payments by a merchandiser to acquire equity securities of other companies. 
E) Receipts of cash sales.

Question 18

Beewell's net income for the year ended December 31,Year 2 was $185,000.Information from Beewell's comparative balance sheets is given below.Compute the cash received from the sale of its common stock during Year 2.

Accepted Answer

A) $185,000. 
B) $106,000. 
C) $95,000. 
D) $50,000. 
E) $145,000. 
A) $185,000. 
B) $106,000. 
C) $95,000. 
D) $50,000. 
E) $145,000.

Question 19

The appropriate section in the statement of cash flows for reporting the purchase of land in exchange for common stock is:

Accepted Answer

A) Operating activities. 
B) Financing activities. 
C) Investing activities. 
D) Schedule of noncash investing or financing activity. 
E) Reconciliation of cash balance. 
A) Operating activities. 
B) Financing activities. 
C) Investing activities. 
D) Schedule of noncash investing or financing activity. 
E) Reconciliation of cash balance.

Question 20

Weston 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 investing activities:

Accepted Answer

A) $(107,700). 
B) $107,700. 
C) $(200,000). 
D) $(139,700). 
E) $(207,700). 
A) $(107,700). 
B) $107,700. 
C) $(200,000). 
D) $(139,700). 
E) $(207,700).

Exam 16: Reporting the Statement of Cash Flows

The statement of cash flows reports and proves the net change in cash for a reporting period.

When using the indirect method to calculate and report the net cash provided or used by operating activities,net income is adjusted for:

Aster Company's 2013 income statement and changes in selected balance sheet accounts are given below.Calculate the company's net cash provided or used by operating activities using the direct method. The company also experienced the following during 2013:

The appropriate section in the statement of cash flows for reporting the purchase of equipment for cash is:

The usual first step in preparing the statement of cash flows is computing the net increase or net decrease in cash.

The use of a spreadsheet for analysis is especially useful when preparing the statement of cash flows using the _____________ method.

Explain the purpose and format of the statement of cash flows.Also describe its relevance to decision makers.

The first line item in the operating activities section of a spreadsheet for a statement of cash flows prepared using the indirect method is:

The statement of cash flows reports:

The indirect method separately lists each major item of operating cash receipts and cash payments.

Hancock reported assets of $13,362 million at January 1 and $13,369 million as of December 31 of the current year.Hancock's net cash flows from operations were $2,204 million.Calculate the cash flow on total assets ratio for Hancock.

The accountant for Robinson Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available: The amount of cash dividends paid during the year would be:

The cash flow on total assets ratio:

Which of the following items is reported on the statement of cash flows under financing activities?

The accounting principle that requires important noncash financing and investing activities be reported on the statement of cash flows or in a footnote is the:

Which one of the following is representative of typical cash flows from operating activities?

Beewell's net income for the year ended December 31,Year 2 was $185,000.Information from Beewell's comparative balance sheets is given below.Compute the cash received from the sale of its common stock during Year 2.

The appropriate section in the statement of cash flows for reporting the purchase of land in exchange for common stock is:

Weston 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 investing activities:

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Plant Assets, natural Resources, and Intangibles

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Capital Budgeting and Managerial Decisions

Time Value of Money B

Activity-Based Costing C

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