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Exam 13: Statement of Cash Flows

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Question 81

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The comparative balance sheet of ConnieJo Company, for December 31, Years 1 and 2 ended December 31 appears below in condensed form: The income statement for the current year is as follows: Additional data for the current year are as follows: Prepare a statement of cash flows, using the direct method of reporting cash flows from operating activities.​

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Question 82

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If accounts payable have increased during a period,

A) revenues on an accrual basis are less than revenues on a cash basis
B) expenses on an accrual basis are less than expenses on a cash basis
C) expenses on an accrual basis are the same as expenses on a cash basis
D) expenses on an accrual basis are greater than expenses on a cash basis

E) B) and D)
F) None of the above

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Question 83

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Accounts receivable from sales transactions were $51,000 at the beginning of the year and $64,000 at the end of the year. Net income reported on the income statement for the year was $105,000. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows prepared by the indirect method is

To arrive at cash flows from operations, it is necessary to convert the income statement from an accrual basis to the cash basis of accounting.

On the statement of cash flows, a $7,500 gain on the sale of fixed assets would be

Cash flows from financing activities, as part of the statement of cash flows, would include any payments for dividends.

Which of the following represents an inflow of cash and therefore would be reported on the statement of cash flows?

Repayments of bonds would be shown as a cash outflow in the investing section of the statement of cash flows.

In determining the cash flows from operating activities for the statement of cash flows by the indirect method, the depreciation expense for the period is added to the net income for the period.

Cash paid for preferred stock dividends should be shown on the statement of cash flows under

A building with a cost of $153,000 and accumulated depreciation of $42,000 was sold for an $11,000 gain. When using the indirect method, the cash generated from this investing activity was $121,000.

For each of the following, identify whether it would be disclosed as an operating (O), financing (F), or investing (I) activity on the statement of cash flows under the indirect method.

To determine cash payments for merchandise for the statement of cash flows using the direct method, a decrease in accounts payable is added to the cost of goods sold. Assume all accounts payable are owed to merchandise suppliers.

Cash paid to acquire treasury stock should be shown on the statement of cash flows under investing activities.

Sales reported on the income statement were $372,000. The accounts receivable balance declined $4,500 over the year. The amount of cash received from customers was $367,500.

On the basis of the following data for Garrett Co. for Years 1 and 2 ended December 31, prepare a statement of cash flows using the indirect method of reporting cash flows from operating activities. Assume that equipment costing $125,000 was purchased for cash and equipment costing $85,000 with accumulated depreciation of $65,000 was sold for $15,000; that the stock was issued for cash; and that the only entries in the retained earnings account were for net income of $56,000 and cash dividends declared of $18,000.

The income statement disclosed the following items for the current year: Balances of the current assets and current liabilities accounts changed between December 31, last year, and December 31, this year, as follows: Prepare the cash flows from operating activities section of the statement of cash flows using the indirect method.

Changes in current assets and current liabilities are reported on the statement of cash flows, indirect method, in the

On the statement of cash flows, the cash flows from financing activities section would include

The following selected account balances appeared on the financial statements of the Washington Company. Use these balances to answer the questions that follow. The Washington Company uses the direct method to calculate net cash flow from operating activities. Assume that all accounts payable are owed to merchandise suppliers.​ -Income tax expense was $175,000 for the year. Income tax payable was $30,000 and $40,000 at the beginning and end of the year, respectively. Cash payments for income tax reported on the statement of cash flows using the direct method is