The statement of cash flows reports
The statement of cash flows reports ________.
cash flows from operating activities
total assets
total changes in stockholders' equity
changes in retained earnings
2. Which of the following does not represent an outflow of cash and therefore would not be reported on the statement of cash flows as a use of cash?
purchase of noncurrent assets
purchase of treasury stock
discarding an asset that had been fully depreciated
payment of cash dividends
The last item on the statement of cash flows prior to the schedule of noncash investing and financing activities reports ________.
the increase or decrease in cash
cash at the end of the year
net cash flow from investing activities
net cash flow from financing activities
4. Cash paid for equipment would be reported in the statement of cash flows in ________.
the cash flows from operating activities section
the cash flows from financing activities section
the cash flows from investing activities section
a separate schedule
5. If accounts payable have increased during a period ________.
revenues on an accrual basis are less than revenues on a cash basis
expenses on an accrual basis are less than expenses on a cash basis
expenses on an accrual basis are the same as expenses on a cash basis
expenses on an accrual basis are greater than expenses on a cash basis
6. Income tax was $400,000 for the year. Income tax payable was $30,000 and $40,000 at the beginning and end of the year. Cash payments for income tax reported on the cash flow statement using the direct method is _______.
$400,000
$390,000
$430,000
$440,000
= $400,000 + $30,000 - $40,000
= $390,000
7. The cost of merchandise sold during the year was $50,000. Merchandise inventories were $12,500 and $10,500 at the beginning and end of the year, respectively. Accounts payable were $6,000 and $5,000 at the beginning and end of the year, respectively. Using the direct method of reporting cash flows from operating activities, cash payments for merchandise total _________.
$49,000
$47,000
$51,000
$53,000
Decrease in Inventory = $12,500 - $10,500 = $2,000
Decrease in Accounts Payable = $6,000 - $5,000 = $1,000
= $50,000 - $2,000
= $48,000
Add: Decrease in Accounts Payable $1,000
Cash payment for merchandise = $49,000
8. Identify whether each of the following would be reported as an operating, investing, or financing activity in the statement of cash flow.
A)Issuance of bonds payable Financing
B)Collection of accounts receivable Operating
C)Purchase of investments Investing
D)Disposal of equipment Investing
E)Payment for selling expenses Operating
F)Cash sales Operating
what is the answer to Disposal of equipment?
Financing
Operating
Investing
None of the above
9. Zale corp accumulated depreciation-equipment increased by 8,000, while patents decreased by 5,200 between balance sheet dates. There were no purchases or sales of depreciable or intangible assets during the year. In addition, the income statement showed a loss of 6,000 from the sale of investments. Reconcile a net income of 90,000 to net cash flow from operating activities. what is the net cash flow from operating activities?
$90,000
$108,000
$109,200
$98,000
= $90,000 + $8,000 + $5,200 + $6,000
= $109,200
10. Sage Corporation's comparative balance sheet for current assets and liabilities was as follows:
Dec 31, 2008Dec 31, 2007
Accounts receivable$ 12,000$ 14,000
Inventory 9,0006,500
Accounts payable8,5007,200
Dividends payable24,00026,000
what is the net cash flow from operating activities?
$110,800
$113,300
$110,000
$115,800
= ($14,000 - $12,000) – ($9,000 - $6,500) + ($8,500 - $7,200) –($26,000 - $24,000)
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