Question 1

Cash transactions related to buying and selling assets that the firm plans to use for longer than one year are investing activities.

Accepted Answer

A) True 
 B)False

Question 2

Managers of a company can use the statement of cash flows to make decisions about ________.

Accepted Answer

A) borrowing 
B) buying new equipment 
C) issuing corporate stock 
D) all of these 
A) borrowing 
B) buying new equipment 
C) issuing corporate stock 
D) all of these

Question 3

The direct method for the preparation of the statement of cash flows ________.

Accepted Answer

A) is required by the FASB 
B) is in conformity with GAAP 
C) is the preferred method used by most businesses 
D) is required by the IASB 
A) is required by the FASB 
B) is in conformity with GAAP 
C) is the preferred method used by most businesses 
D) is required by the IASB

Question 4

Team Shirts,Inc.paid dividends of $1,250 to shareholders.This is an ________ activities.

Accepted Answer

A) inflow from investing 
B) outflow for financing 
C) inflow from operating 
D) outflow for operating 
A) inflow from investing 
B) outflow for financing 
C) inflow from operating 
D) outflow for operating

Question 5

Williston Skateboards had net cash from operating activities of $63,780.During the month,the firm paid no dividends and $575 in interest.Williston Skateboards also spent $4,925 on office equipment.Free cash flow for the month was ________.

Accepted Answer

A) $63,780 
B) $63,205 
C) $58,280 
D) $58,855 
A) $63,780 
B) $63,205 
C) $58,280 
D) $58,855

Question 6

Cash from investing activities includes ________.

Accepted Answer

A) all cash receipts and all cash disbursements for long-term business assets 
B) all cash receipts and all cash disbursements for loans,contributions from owners,and distributions to owners 
C) all cash receipts and cash disbursements for routine sales and purchases made in the course of doing business 
D) detailed estimates of the sources of cash and uses of cash 
A) all cash receipts and all cash disbursements for long-term business assets 
B) all cash receipts and all cash disbursements for loans,contributions from owners,and distributions to owners 
C) all cash receipts and cash disbursements for routine sales and purchases made in the course of doing business 
D) detailed estimates of the sources of cash and uses of cash

Question 7

Team Shirts,Inc.paid $1,000 of interest.How is this amount reported on the statement of cash flows?

Accepted Answer

The $1,000 would be reported a

Question 8

Most companies use the indirect method of reporting cash from operating activities.

Accepted Answer

A) True 
 B)False

Question 9

Explain how the operating activities section of the statement of cash flows is prepared using the indirect method.

Accepted Answer

The indirect method for the statement of

Question 10

Match between columns
                        Premises: purchase of land in exchange for stock
issuance of bonds
payment of interest expense
sale of a used delivery van
purchase of store equipment

Accepted Answer

The Answer of noncash item and financing activities and operating is...

Question 11

Match each of the following line items with the type of activity.

-payment of interest expense

Accepted Answer

A) operating activities 
B) investing activities 
C) financing activities 
D) noncash item 
A) operating activities 
B) investing activities 
C) financing activities 
D) noncash item

Question 12

Use the following information from Artizan,Inc.'s computerized accounting information system to prepare the statement of cash flows for May using the direct method.

Accepted Answer

The answer of Use the following information from Artizan,Inc.'s computerized...

Question 13

A statement of cash flows based on the indirect method is prepared by converting every number on the income statement to its cash amount.

Accepted Answer

A) True 
 B)False

Question 14

sale of a used delivery van

Accepted Answer

A) operating activities 
B) investing activities 
C) financing activities 
D) noncash item 
A) operating activities 
B) investing activities 
C) financing activities 
D) noncash item

Question 15

The following information is from Z,Inc.'s December 31,2011 annual report:   Note: Z,Inc.does not sell to its customers on account; it collects cash from its customers in advance.
Cash paid for interest on Z,Inc.'s statement of cash flows equals ________.

Accepted Answer

A) $30,000 
B) $28,000 
C) $33,000 
D) $32,000 
A) $30,000 
B) $28,000 
C) $33,000 
D) $32,000

Question 16

Cash involved in financing activities includes cash ________.

Accepted Answer

A) collected from customers 
B) paid for land 
C) paid for interest 
D) paid for dividends 
A) collected from customers 
B) paid for land 
C) paid for interest 
D) paid for dividends

Question 17

The statement of cash flows reports the ________.

Accepted Answer

A) sources and uses of cash 
B) financial position of a company 
C) changes in shareholders' equity 
D) profitability of a company 
A) sources and uses of cash 
B) financial position of a company 
C) changes in shareholders' equity 
D) profitability of a company

Question 18

Match between columns
                        Premises: sale of a used computer system
payment of employee salaries
purchase of treasury stock
collection of accounts receivable

Accepted Answer

The Answer of financing activities and operating activities and investing is...

Question 19

Analysts use free cash flows to measure ________.

Accepted Answer

A) the ability of a company to raise money through the sale of stock 
B) the amount of money available to pay dividends 
C) the amount of cash generated by operating activities 
D) a firm's ability to operate successfully over the long-term 
A) the ability of a company to raise money through the sale of stock 
B) the amount of money available to pay dividends 
C) the amount of cash generated by operating activities 
D) a firm's ability to operate successfully over the long-term

Question 20

If a company uses the direct method of calculating cash from operating activities,net income is adjusted for non-cash transactions.

Accepted Answer

A) True 
 B)False

Cash transactions related to buying and selling assets that the firm plans to use for longer than one year are investing activities.

Managers of a company can use the statement of cash flows to make decisions about ________.

The direct method for the preparation of the statement of cash flows ________.

Team Shirts,Inc.paid dividends of $1,250 to shareholders.This is an ________ activities.

Williston Skateboards had net cash from operating activities of $63,780.During the month,the firm paid no dividends and $575 in interest.Williston Skateboards also spent $4,925 on office equipment.Free cash flow for the month was ________.

Cash from investing activities includes ________.

Team Shirts,Inc.paid $1,000 of interest.How is this amount reported on the statement of cash flows?

Most companies use the indirect method of reporting cash from operating activities.

Explain how the operating activities section of the statement of cash flows is prepared using the indirect method.

Match each of the following line items with the type of activity. -payment of interest expense

Use the following information from Artizan,Inc.'s computerized accounting information system to prepare the statement of cash flows for May using the direct method.

A statement of cash flows based on the indirect method is prepared by converting every number on the income statement to its cash amount.

sale of a used delivery van

The following information is from Z,Inc.'s December 31,2011 annual report: Note: Z,Inc.does not sell to its customers on account; it collects cash from its customers in advance. Cash paid for interest on Z,Inc.'s statement of cash flows equals ________.

Cash involved in financing activities includes cash ________.

The statement of cash flows reports the ________.

Analysts use free cash flows to measure ________.

If a company uses the direct method of calculating cash from operating activities,net income is adjusted for non-cash transactions.

Business: Whats It All About

Qualities of Accounting Information

Accruals and Deferrals: Timing Is Everything in Accounting

Payment for Goods and Services: Cash and Accounts Receivable

The Purchase and Sale of Inventory

Acquisition and Use of Long-Term Assets

Accounting for Liabilities

Accounting for Shareholders Equity

Using Financial Statement Analysis to Evaluate Firm Performance

Quality of Earnings, corporate Governance, and Ifrs

Filters

Exam 9: Preparing and Analyzing the Statement of Cash Flows

Cash transactions related to buying and selling assets that the firm plans to use for longer than one year are investing activities.

Managers of a company can use the statement of cash flows to make decisions about ________.

The direct method for the preparation of the statement of cash flows ________.

Team Shirts,Inc.paid dividends of $1,250 to shareholders.This is an ________ activities.

Williston Skateboards had net cash from operating activities of $63,780.During the month,the firm paid no dividends and $575 in interest.Williston Skateboards also spent $4,925 on office equipment.Free cash flow for the month was ________.

Cash from investing activities includes ________.

Team Shirts,Inc.paid $1,000 of interest.How is this amount reported on the statement of cash flows?

Most companies use the indirect method of reporting cash from operating activities.

Explain how the operating activities section of the statement of cash flows is prepared using the indirect method.

Match each of the following line items with the type of activity. -payment of interest expense

Use the following information from Artizan,Inc.'s computerized accounting information system to prepare the statement of cash flows for May using the direct method.

A statement of cash flows based on the indirect method is prepared by converting every number on the income statement to its cash amount.

sale of a used delivery van

The following information is from Z,Inc.'s December 31,2011 annual report: Note: Z,Inc.does not sell to its customers on account; it collects cash from its customers in advance. Cash paid for interest on Z,Inc.'s statement of cash flows equals ________.

Cash involved in financing activities includes cash ________.

The statement of cash flows reports the ________.

Analysts use free cash flows to measure ________.

If a company uses the direct method of calculating cash from operating activities,net income is adjusted for non-cash transactions.

Business: Whats It All About

Qualities of Accounting Information

Accruals and Deferrals: Timing Is Everything in Accounting

Payment for Goods and Services: Cash and Accounts Receivable

The Purchase and Sale of Inventory

Acquisition and Use of Long-Term Assets

Accounting for Liabilities

Accounting for Shareholders Equity

Using Financial Statement Analysis to Evaluate Firm Performance

Quality of Earnings, corporate Governance, and Ifrs

Filters