Deck 14: Disclosure: Statement of Cash Flows

Question 1

What is the net cash inflow from operating activities?

A)$45 000
B)$59 000
C)$60 000
D)$61 000.

Answer 1

D

Question 2

What is the net cash inflow (outflow)from investing activities?

A)$2000 inflow
B)$6000 inflow
C)$(2000)outflow
D)$(4000)outflow.

Answer 2

C

Question 3

AASB 107 Statement of Cash Flows,requires that investing and financing transactions that do not require the use of cash or cash equivalents should be:

A)excluded from a Statement of Cash Flows
B)included in a Statement of Cash Flows before operating,investing and financing activities
C)presented in the Statement of Cash Flows after operating activities and before investing and financing activities;
D)presented in a Statement of Cash Flows after the operating,investing and financing activities have been presented.

Answer 3

A

Question 4

Items classified as financing activities on an entity's Statement of Cash Flows are usually associated with:

A)movements in non-current liabilities and equity
B)sales of goods and services by the entity
C)disposal of non-current assets
D)purchase on shares by the entity.

Question 5

Identify the three ways to classify cash flows.

Question 6

The following information was extracted from the records of Ustinof Limited
-Opening balance of Equipment,$360 000
-Closing balance of Equipment,$400 000
-Cost of new Equipment,$80 000
-Proceeds from sale of Equipment,$6000 (Cost $40 000; Carrying amount $10 000)
The total cash flows from investing activities is determined as

A)$40 000 cash outflow
B)$74 000 cash outflow
C)$76 000 cash outflow
D)$80 000 cash outflow.

Question 7

The following cash flow activities are regarded as investing cash flows:

A)income taxes paid
B)interest paid
C)acquisition of subsidiary net of cash acquired
D)proceeds from issue of debentures.

Question 8

Operating activities on a Statement of Cash Flows are generally associated with:

A)movements in non-current liabilities of an entity
B)revenues and expenses of an entity
C)acquisitions of non-current assets of an entity
D)changes in equity of an entity.

Question 9

Outline the arguments for the classification of dividends received as a component of operating activities and dividends paid as a component financing activities.

Question 10

According to AASB 107 Statement of Cash Flows,which of the following items does not fall within the definition of cash?

A)Bank notes and coins
B)Non-bank bills that are readily convertible to cash
C)Deposits on the short-term money market with a term of less than 3 months
D)Accounts receivable

Question 11

Which of the following items must be separately disclosed in the Statement of Cash Flows?
I)Dividends paid
II)Interest received
III)Dividends received
IV)Interest paid
V)Auditor's remuneration paid

A)I,II,III and IV only
B)II,III and IV only
C)I,II and V only
D)II,III,IV and V only

Question 12

Discuss the purpose of the Statement of Cash Flows.

Question 13

The following item is classified as a 'financing activity' in the Statement of Cash Flows:

A)interest paid on debentures
B)cash received from accounts receivable
C)cash payment on redemption of the company's debentures
D)cash payment to purchase debentures of another entity.

Question 14

During the financial year Sugianto Limited had sales of $42 000.The opening balance of accounts receivable was $9000,and the closing balance was $12 700.Bad debts amounting to $700 were written off during the period.The cash receipts from sales during the year amounted to:

A)$37 600
B)$39 000
C)$38 300
D)$45 700.

Question 15

Which of the following items would be presented in a Statement of Cash Flows?

A)Payment of dividends through a share investment scheme
B)Acquisition of an investment in a subsidiary for consideration consisting of an exchange of non-current assets and liabilities
C)Proceeds from the issue of debentures
D)Refinancing of long-term debt

Question 16

What is the net cash inflow (outflow)from financing activities?

A)$38 000 inflow
B)$40,000 inflow
C)$42,000 inflow
D)$(2000)outflow.

Question 17

Katsis Limited had the following cash flows during the reporting period:
-Purchase of intangibles $30 000
-Proceeds from sale of plant $28 000
-Receipts from customers $832 000
-Payments to suppliers $593 000
-Interest received $17 600
-Income taxes paid $45 500
The net cash flows from operating activities was:

A)$211 100
B)$239 100
C)$256 600
D)$269 100.

Question 18

Which of the following items is classified as part of 'operating activities' in the Statement of Cash Flows?

A)Depreciation of non-current assets
B)Receipts from customers from the sale of goods
C)Bad debts expense
D)Proceeds from the sale of non-current assets

Question 19

Brett Limited had a net profit after tax of $850 000 for the financial year.Included in this profit was:
-Depreciation expense of $120 000
-Gain on sale of Investments of $28 000
Also,Accounts Receivable increased by $39 000 and Inventories decreased by $12 000.The cash flow from operating activities during the year was:

A)$731 000
B)$785 000
C)$915 000
D)$969 000.

Question 20

What are the deemed advantages to financial statement users of the information contained in a Statement of Cash Flows?

Question 21

Explain why the cash flows from operating activities are reported separately on a Statement of Cash Flows.