Question 1

Equipment costing $100,000 with accumulated depreciation of $40,000 is sold at a loss of $10,000.The cash received from the sale was $40,000.

Accepted Answer

A) True 
 B)False  False

Question 2

The statement of cash flows is divided into three sections called the _____________,____________,and _____________ sections.

Accepted Answer

Operating; financing; investing

Question 3

The appropriate statement of cash flows activity category for the purchase of land in exchange for common shares is:

Accepted Answer

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

Question 4

The direct method for the preparation of the operating activities section of the statement of cash flows:

Accepted Answer

A)  Separately lists each major item of operating cash receipts. 
B)  Separately lists each major item of operating cash payments. 
C)  Separately lists each major item of operating cash receipts and cash payments. 
D)  Reports net income and then adjusts it for items necessary to determine net cash provided or used by operating activities. 
E)  All of these answers are correct. 
A)  Separately lists each major item of operating cash receipts. 
B)  Separately lists each major item of operating cash payments. 
C)  Separately lists each major item of operating cash receipts and cash payments. 
D)  Reports net income and then adjusts it for items necessary to determine net cash provided or used by operating activities. 
E)  All of these answers are correct.

Question 5

On the statement of cash flows,business operations are classified as operating,investing,or financing activities.

Accepted Answer

A) True 
 B)False

Question 6

Investing activities include:

Accepted Answer

A)  Purchase of long-term assets. 
B)  Lending and collecting on notes receivable. 
C)  Sale of equity investments. 
D)  Sale of long-term assets. 
E)  All of these answers are correct. 
A)  Purchase of long-term assets. 
B)  Lending and collecting on notes receivable. 
C)  Sale of equity investments. 
D)  Sale of long-term assets. 
E)  All of these answers are correct.

Question 7

Under the indirect method,noncash operating expenses are added back to net income when preparing the investing section of the statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 8

Changes in notes payable,non-current liabilities,and equity accounts are usually used in calculating and reporting:

Accepted Answer

A)  Cash flows from investing activities. 
B)  Cash flows from operating activities. 
C)  Cash flows from financing activities. 
D)  Non-cash financing activities. 
E)  Non-cash balance sheet accounts. 
A)  Cash flows from investing activities. 
B)  Cash flows from operating activities. 
C)  Cash flows from financing activities. 
D)  Non-cash financing activities. 
E)  Non-cash balance sheet accounts.

Question 9

Investments must be within 6 months of their maturity dates to be classified as cash equivalents.

Accepted Answer

A) True 
 B)False

Question 10

A statement of cash flows should reconcile the differences between the beginning and ending balances of:

Accepted Answer

A)  Cash. 
B)  Cash equivalents. 
C)  Cash and cash equivalents. 
D)  Working capital. 
E)  Cash,cash equivalents,and long term investments. 
A)  Cash. 
B)  Cash equivalents. 
C)  Cash and cash equivalents. 
D)  Working capital. 
E)  Cash,cash equivalents,and long term investments.

Question 11

A noncash investing transaction should be disclosed as a note to the statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 12

Reconstruction analysis is used to identify the types of purchases and disposals of property,plant and equipment by reproducing the entries that occurred in the year.

Accepted Answer

A) True 
 B)False

Question 13

Selected balances from Poppy Company's records are as follows:

Accepted Answer

The answer of Selected balances from Poppy Company's records are...

Question 14

The purpose of the statement of cash flows is to report the major items comprising _____________ and ________________.

Accepted Answer

Cash recei

Question 15

An investment that must be readily convertible to known amounts of cash,that is subject to insignificant risk of changes in value,and normally qualifies only when it has a short maturity of three months or less from the date of acquisition is called a(n):

Accepted Answer

A)  Trading security. 
B)  Cash equivalent. 
C)  Treasury bill,commercial paper,or equity security. 
D)  Operating activity. 
E)  Financing activity. 
A)  Trading security. 
B)  Cash equivalent. 
C)  Treasury bill,commercial paper,or equity security. 
D)  Operating activity. 
E)  Financing activity.

Question 16

The appropriate statement of cash flow activity category for the purchase of equipment for cash is:

Accepted Answer

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

Question 17

The full disclosure principle requires that noncash investing and financing activities be disclosed in a separate schedule attached to the statement of cash flows,or in the accompanying notes.

Accepted Answer

A) True 
 B)False

Question 18

When using the direct method,which of the following should be reported as a source of cash from operating activities?

Accepted Answer

A)  Credit sales. 
B)  Depreciation expense. 
C)  Collections from customers. 
D)  Sale of a building. 
E)  Sale of treasury shares. 
A)  Credit sales. 
B)  Depreciation expense. 
C)  Collections from customers. 
D)  Sale of a building. 
E)  Sale of treasury shares.

Question 19

A gain on the disposal of a long-term asset:

Accepted Answer

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

Question 20

A purchase of land in exchange for shares is disclosed in a separate schedule attached to the statement of cash flows or in a note to the statement.

Accepted Answer

A) True 
 B)False

Equipment costing $100,000 with accumulated depreciation of $40,000 is sold at a loss of $10,000.The cash received from the sale was $40,000.

The statement of cash flows is divided into three sections called the _,,and _ sections.

The appropriate statement of cash flows activity category for the purchase of land in exchange for common shares is:

The direct method for the preparation of the operating activities section of the statement of cash flows:

On the statement of cash flows,business operations are classified as operating,investing,or financing activities.

Investing activities include:

Under the indirect method,noncash operating expenses are added back to net income when preparing the investing section of the statement of cash flows.

Changes in notes payable,non-current liabilities,and equity accounts are usually used in calculating and reporting:

Investments must be within 6 months of their maturity dates to be classified as cash equivalents.

A statement of cash flows should reconcile the differences between the beginning and ending balances of:

A noncash investing transaction should be disclosed as a note to the statement of cash flows.

Reconstruction analysis is used to identify the types of purchases and disposals of property,plant and equipment by reproducing the entries that occurred in the year.

Selected balances from Poppy Company's records are as follows:

The purpose of the statement of cash flows is to report the major items comprising _ and ____.

An investment that must be readily convertible to known amounts of cash,that is subject to insignificant risk of changes in value,and normally qualifies only when it has a short maturity of three months or less from the date of acquisition is called a(n):

The appropriate statement of cash flow activity category for the purchase of equipment for cash is:

The full disclosure principle requires that noncash investing and financing activities be disclosed in a separate schedule attached to the statement of cash flows,or in the accompanying notes.

When using the direct method,which of the following should be reported as a source of cash from operating activities?

A gain on the disposal of a long-term asset:

A purchase of land in exchange for shares is disclosed in a separate schedule attached to the statement of cash flows or in a note to the statement.

Property,plant and Equipment,and 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

Exam 17: Reporting and Analyzing Cash Flows

Equipment costing $100,000 with accumulated depreciation of $40,000 is sold at a loss of $10,000.The cash received from the sale was $40,000.

The statement of cash flows is divided into three sections called the _____________,____________,and _____________ sections.

The appropriate statement of cash flows activity category for the purchase of land in exchange for common shares is:

The direct method for the preparation of the operating activities section of the statement of cash flows:

On the statement of cash flows,business operations are classified as operating,investing,or financing activities.

Investing activities include:

Under the indirect method,noncash operating expenses are added back to net income when preparing the investing section of the statement of cash flows.

Changes in notes payable,non-current liabilities,and equity accounts are usually used in calculating and reporting:

Investments must be within 6 months of their maturity dates to be classified as cash equivalents.

A statement of cash flows should reconcile the differences between the beginning and ending balances of:

A noncash investing transaction should be disclosed as a note to the statement of cash flows.

Reconstruction analysis is used to identify the types of purchases and disposals of property,plant and equipment by reproducing the entries that occurred in the year.

Selected balances from Poppy Company's records are as follows:

The purpose of the statement of cash flows is to report the major items comprising _____________ and ________________.

An investment that must be readily convertible to known amounts of cash,that is subject to insignificant risk of changes in value,and normally qualifies only when it has a short maturity of three months or less from the date of acquisition is called a(n):

The appropriate statement of cash flow activity category for the purchase of equipment for cash is:

The full disclosure principle requires that noncash investing and financing activities be disclosed in a separate schedule attached to the statement of cash flows,or in the accompanying notes.

When using the direct method,which of the following should be reported as a source of cash from operating activities?

A gain on the disposal of a long-term asset:

A purchase of land in exchange for shares is disclosed in a separate schedule attached to the statement of cash flows or in a note to the statement.

Property,plant and Equipment,and 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

The statement of cash flows is divided into three sections called the _,,and _ sections.

The purpose of the statement of cash flows is to report the major items comprising _ and ____.