Exam 5: Statement of Cash Flows and Articulation

In a statement of cash flows prepared using the direct method,if wages payable increased during the year,the cash paid for wages would be

The following information is available from the financial statements of Barrington Corporation for the year ended December 31,2014: What is Barrington Corporation's net cash flow from operating activities?

During the year,Samuels Company reported net income of $300,000,including amortization of intangible assets of $66,000,depreciation of plant assets of $132,000,and amortization of premium on investment in bonds of $20,000.Applying the indirect method,cash provided by operating activities is what amount?

A loss on the sale of machinery in the ordinary course of business should be presented in a statement of cash flows (indirect method)as

Partial balance sheet data and additional information for Samuelson Company are listed below: Additional Information: (a)Net income for 2014 was $15,000. (b)Depreciation expense for 2014 was $30,000. (c)Sales for 2014 totaled $490,000; cost of goods sold was $350,000. Compute the amount of cash paid in 2011 for inventory purchases.

Net income for the Hot Springs Company for the most recent year was $150,000,consisting of $865,000 of revenues,$360,000 of cost of goods sold,and $365,000 of operating expenses.The following changes in current assets and current liabilities have been identified: 1.Accounts receivable increased by $85,000. 2.Inventory decreased by $37,500. 3.Accounts payable increased by $82,500. 4.Accrued operating expenses payable decreased by $45,000. Required: Calculate the cash flows from operating activities for the year,applying the direct method.Identify the individual amounts that would be disclosed in the statement of cash flows where possible.

Stanner Company's 2014 income statement reported cost of goods sold as $135,000.Additional information is as follows: If Stanner uses the direct method,what amount should Stanner report as cash paid to suppliers in its 2014 statement of cash flows?

In a statement of cash flows,interest payments to lenders and other creditors should be classified as cash outflows for

In a statement of cash flows using the direct method,which of the following would increase reported cash flows from operating activities?

A major controversy in the issuance of Statement of Financial Accounting Standards No.95¸ "Statement of Cash Flows," centered around the possibility of the Board's requiring the direct method of reporting operating cash flows.Bankers who responded to the Exposure Draft preceding the issuance of the pronouncement on cash flows expressed a preference for the direct method.Practicing CPAs have been shown in studies to favor the indirect method.The Board has allowed both the indirect and direct methods to be used,although the Board expressed a preference for the direct method. Evaluate the strengths and weaknesses of the direct and indirect methods and why you believe the Board decided to allow preparers of financial statements a choice between the two methods.

In a statement of cash flows,proceeds from issuing equity instruments should be classified as cash inflows from

A decrease in accounts receivable should be presented in a statement of cash flows (indirect method)as

Which of the following is not a cash inflow from investing activities?

Which of the following is true?

The following is a comparative balance sheet of Conumdrum Corporation for December 31,2014 and 2013: Additional information: (a)Net income for 2014,$545,600. (b)Depreciation reported on income statement,$140,000. (c)Fully depreciated equipment,no salvage value,was scrapped.Equipment was purchased for $560,000. (d)Bonds of $400,000 were retired at their face value. (e)10,000 shares of common stock were issued for cash at $28 per share. (f)Cash dividends declared and paid,$240,000. (g)Available-for-sale securities with a book value of $200,000 were sold for $300,000. Prepare a statement of cash flows for Conumdrum Corporation for 2014,using the indirect method.Compute the cash flow to net income and cash flow adequacy ratios.

Cash flows from investing activities would be decreased by which of the following?

Users of financial statements are interested in the ability of a firm to generate favorable cash flows.This is one reason why the FASB has required the inclusion of a statement of cash flows in the primary financial statements of an enterprise.A cash flow of major interest to investors is the dividends an enterprise has paid in the past and will pay in the future.Investors are particularly interested in the prediction of future dividends.The prediction of the cash flows associated with dividends requires,however,that investors have information regarding other cash flows of the enterprise. Identify cash flows of an enterprise the knowledge of which would be useful to users of the financial statement in the prediction of future dividends.

Using the indirect method,cash flows from operating activities would be increased by which of the following?

When preparing a statement of cash flows using the indirect method,the amortization of trademarks should be reported as a(n)

Partial balance sheet data and additional information for Bohemian Industries are given below: Additional Information: (a)Net income for 2014 was $60,000. (b)Depreciation expense for 2014 was $25,000. Prepare the operating activities section of the statement of cash flows,using the indirect method,for the year ending December 31,2014.