Question 1

Under the indirect method,depreciation expense is subtracted from net income.

Accepted Answer

A) True 
 B)False

Question 2

The purpose of the statement of cash flows is to report the major items comprising cash receipts and cash payments during a period.

Accepted Answer

A) True 
 B)False

Question 3

All cash transactions eventually affect noncash ____________ accounts.

Accepted Answer

The answer of All cash transactions eventually affect noncash ____________...

Question 4

Under the direct method,the gain or loss from retirement of debt is reported in the operating section of the statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 5

Financing activities include receiving cash from issuing debt and receiving dividends from investments in other corporations.

Accepted Answer

A) True 
 B)False

Question 6

Information to prepare the statement of cash flows usually comes from (a)comparative balance sheets,(b)current income statements,and (c)additional information.

Accepted Answer

A) True 
 B)False

Question 7

Calculate (1)the cost of goods purchased and (2)the cash paid for merchandise based on the following information provided about the operations of Olney Company.

Accepted Answer

The answer of Calculate (1)the cost of goods purchased and...

Question 8

Preparation of the statement of cash flows involves:

Accepted Answer

A)  Calculation of the net increase or decrease in cash. 
B)  Calculation and reporting of net cash provided or used by operating activities. 
C)  Calculation and reporting of net cash provided or used by investing activities. 
D)  Calculation and reporting of net cash provided or used by financing activities. 
E)  All of these answers are correct. 
A)  Calculation of the net increase or decrease in cash. 
B)  Calculation and reporting of net cash provided or used by operating activities. 
C)  Calculation and reporting of net cash provided or used by investing activities. 
D)  Calculation and reporting of net cash provided or used by financing activities. 
E)  All of these answers are correct.

Question 9

When preparing the operating activities 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 activities section of...

Question 10

Cash flows from selling long term investments are reported in the statement of cash flows as:

Accepted Answer

A)  Operating activities. 
B)  Financing activities. 
C)  Investing activities. 
D)  Noncash activities. 
E)  Not reported. 
A)  Operating activities. 
B)  Financing activities. 
C)  Investing activities. 
D)  Noncash activities. 
E)  Not reported.

Question 11

Describe the steps involved in the preparation of the statement of cash flows.

Accepted Answer

The preparation of the statement of cash

Question 12

The Merchandise Inventory for Year 1 was $100,000 and for Year 2 was $94,000.The Accounts Payable account for Year 1 was $40,000 and for Year 2 was $42,000.Cost of goods sold for Year 2 was $460,000.What was the total amount for cash payments for merchandise for Year 2?

Accepted Answer

A)  $448,000. 
B)  $449,000. 
C)  $452,000. 
D)  $456,000. 
E)  $84,000. 
A)  $448,000. 
B)  $449,000. 
C)  $452,000. 
D)  $456,000. 
E)  $84,000.

Question 13

Conversion of preferred shares to common shares is disclosed in the financing section of the statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 14

James Manufacturing Company purchased plant assets that cost $100,000 by paying $20,000 in cash and financing the balance by issuing a note payable to the seller.This transaction is disclosed on a statement of cash flows as follows:

Accepted Answer

A) 
  
B) 
  
C) 
  
D)  As a note to the statement of cash flows 
E)    
A) 
  
B) 
  
C) 
  
D)  As a note to the statement of cash flows 
E)

Question 15

The statement of cash flows reports:

Accepted Answer

A)  Assets,liabilities,and owners' equity. 
B)  Cash inflows and outflows for an accounting period. 
C)  Revenues,gains,expenses,and losses. 
D)  Owners' equity,net income,and dividends. 
E)  Cash inflows and outflows for an accounting period and owners' equity,net income,and dividends. 
A)  Assets,liabilities,and owners' equity. 
B)  Cash inflows and outflows for an accounting period. 
C)  Revenues,gains,expenses,and losses. 
D)  Owners' equity,net income,and dividends. 
E)  Cash inflows and outflows for an accounting period and owners' equity,net income,and dividends.

Question 16

The statement of cash flows is:

Accepted Answer

A)  Another name for the statement of financial position. 
B)  A financial statement that reports the cash inflows and outflows for an accounting period. 
C)  A financial statement that presents information about what happened to equity during a period. 
D)  A financial statement that lists the types and amounts of assets,liabilities,and equity of a business on a specific date. 
E)  A financial statement that lists the types and amounts of the revenues and expenses of a business. 
A)  Another name for the statement of financial position. 
B)  A financial statement that reports the cash inflows and outflows for an accounting period. 
C)  A financial statement that presents information about what happened to equity during a period. 
D)  A financial statement that lists the types and amounts of assets,liabilities,and equity of a business on a specific date. 
E)  A financial statement that lists the types and amounts of the revenues and expenses of a business.

Question 17

Amy Corporation's income statement showed the following: net income,$72,000; depreciation expense,$8,000; and gain on sale of plant assets,$6,000.An examination of the company's current assets and current liabilities showed the following changes as a result of operating activities: accounts receivable decreased $5,700; merchandise inventory increased $8,000; prepaid expenses decreased $2,100; accounts payable increased $1,700.Calculate the net cash provided (or used)by operating activities.

Accepted Answer

A)  $68,800. 
B)  $82,500. 
C)  $66,500. 
D)  $71,800. 
E)  $75,500. 
A)  $68,800. 
B)  $82,500. 
C)  $66,500. 
D)  $71,800. 
E)  $75,500.

Question 18

A calculation of the net cash provided or used by operating activities that lists the major classes of operating cash receipts,such as receipts from customers,and subtracts the major classes of operating cash disbursements,such as cash paid for merchandise,is the:

Accepted Answer

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

Question 19

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

Accepted Answer

Operating

Question 20

Explain noncash investing and financing activities and the method of reporting them on the statement of cash flows.

Accepted Answer

Noncash financing and investing activiti

Under the indirect method,depreciation expense is subtracted from net income.

The purpose of the statement of cash flows is to report the major items comprising cash receipts and cash payments during a period.

All cash transactions eventually affect noncash ____________ accounts.

Under the direct method,the gain or loss from retirement of debt is reported in the operating section of the statement of cash flows.

Financing activities include receiving cash from issuing debt and receiving dividends from investments in other corporations.

Information to prepare the statement of cash flows usually comes from (a)comparative balance sheets,(b)current income statements,and (c)additional information.

Calculate (1)the cost of goods purchased and (2)the cash paid for merchandise based on the following information provided about the operations of Olney Company.

Preparation of the statement of cash flows involves:

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

Cash flows from selling long term investments are reported in the statement of cash flows as:

Describe the steps involved in the preparation of the statement of cash flows.

The Merchandise Inventory for Year 1 was $100,000 and for Year 2 was $94,000.The Accounts Payable account for Year 1 was $40,000 and for Year 2 was $42,000.Cost of goods sold for Year 2 was $460,000.What was the total amount for cash payments for merchandise for Year 2?

Conversion of preferred shares to common shares is disclosed in the financing section of the statement of cash flows.

James Manufacturing Company purchased plant assets that cost $100,000 by paying $20,000 in cash and financing the balance by issuing a note payable to the seller.This transaction is disclosed on a statement of cash flows as follows:

The statement of cash flows reports:

The statement of cash flows is:

A calculation of the net cash provided or used by operating activities that lists the major classes of operating cash receipts,such as receipts from customers,and subtracts the major classes of operating cash disbursements,such as cash paid for merchandise,is the:

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

Explain noncash investing and financing activities and the method of reporting them on the statement of cash flows.

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

Under the indirect method,depreciation expense is subtracted from net income.

The purpose of the statement of cash flows is to report the major items comprising cash receipts and cash payments during a period.

All cash transactions eventually affect noncash ____________ accounts.

Under the direct method,the gain or loss from retirement of debt is reported in the operating section of the statement of cash flows.

Financing activities include receiving cash from issuing debt and receiving dividends from investments in other corporations.

Information to prepare the statement of cash flows usually comes from (a)comparative balance sheets,(b)current income statements,and (c)additional information.

Calculate (1)the cost of goods purchased and (2)the cash paid for merchandise based on the following information provided about the operations of Olney Company.

Preparation of the statement of cash flows involves:

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

Cash flows from selling long term investments are reported in the statement of cash flows as:

Describe the steps involved in the preparation of the statement of cash flows.

The Merchandise Inventory for Year 1 was $100,000 and for Year 2 was $94,000.The Accounts Payable account for Year 1 was $40,000 and for Year 2 was $42,000.Cost of goods sold for Year 2 was $460,000.What was the total amount for cash payments for merchandise for Year 2?

Conversion of preferred shares to common shares is disclosed in the financing section of the statement of cash flows.

James Manufacturing Company purchased plant assets that cost $100,000 by paying $20,000 in cash and financing the balance by issuing a note payable to the seller.This transaction is disclosed on a statement of cash flows as follows:

The statement of cash flows reports:

The statement of cash flows is:

A calculation of the net cash provided or used by operating activities that lists the major classes of operating cash receipts,such as receipts from customers,and subtracts the major classes of operating cash disbursements,such as cash paid for merchandise,is the:

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

Explain noncash investing and financing activities and the method of reporting them on the statement of cash flows.

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