FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 16: Reporting the Statement of Cash Flows

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 71

Multiple Choice

Review LaterAdd Note

Review Later

The statement of cash flows is:

A) A financial statement that lists the types and amounts of the revenues and expenses of a business for an accounting period.
B) Another name for the statement of financial position.
C) A financial statement that lists the types and amounts of assets, liabilities, and equity of a business on a specific date.
D) A financial statement that presents information about changes in equity during a period.
E) A financial statement that reports the cash inflows and cash outflows for an accounting period, and that classifies those cash flows as operating activities, investing activities, or financing activities.

F) A) and C)
G) None of the above

Correct Answer

verified

Show Answer

Question 72

Multiple Choice

Review LaterAdd Note

Review Later

Cash flows from interest received on loans are reported in the statement of cash flows as part of:

A) Operating activities.
B) Financing activities.
C) This is not reported in the statement of cash flows.
D) Noncash activities.
E) Investing activities.

F) A) and B)
G) B) and E)

Correct Answer

verified

Show Answer

Question 73

True/False

Review LaterAdd Note

The gain or loss from retirement of debt is reported under cash flows from operating activities on the statement of cash flows using the indirect method.

The payment of cash dividends never changes the balance of retained earnings.

Use the following information to calculate cash received from dividends: $\begin{array}{lr}\text { Dividends revenue } & \$ 29,800 \\\text { Dividends receivable, January 1 } & 2,600 \\\text { Dividends receivable, December 31 } & 3,400\end{array}$

The cash flow on total assets ratio compared to the total assets ratio can be used as an indicator of earnings quality.

When preparing the operating activities section of the statement of cash flows using the indirect method, decreases in current operating assets are added to net income.

A cash-based measure to help business decision makers estimate the amount and timing of cash flows is the cash flow on total assets ratio.

When preparing the operating activities section of the statement of cash flows using the indirect method, an increase in income taxes payable is added to net income.

Use the following information to calculate cash paid for wages and salaries: $\begin{array}{l|r}\text { Salaries expense } & \$ 168,000 \\\hline \text { Salaries payable, January 1 } & 6,400 \\\hline \text { Salaries payable, December 31 } & 10,600\end{array}$

Cash flows are essentially the same as net income because they are both measured using accrual accounting principles.

The statement of cash flows explains the difference between the beginning and ending balances of cash and cash equivalents.

When preparing the operating activities section of the statement of cash flows using the indirect method, a decrease in accounts receivable is subtracted from net income.

When the operating activities section of the statement of cash flows is reported using the direct method, the FASB requires:

When using the indirect method to calculate and report net cash provided or used by operating activities, which of the following is subtracted from net income?

Scranton, Inc. reports net income of $230,000 for the year ended December 31. It also reports $87,700 depreciation expense and a $5,000 gain on the sale of equipment. Its comparative balance sheet reveals a $35,500 decrease in accounts receivable, a $15,750 increase in accounts payable, and a $12,500 decrease in wages payable. Calculate the cash provided (used) in operating activities using the indirect method.

The appropriate section in the statement of cash flows for reporting the purchase of land in exchange for common stock is:

When preparing the operating activities section of the statement of cash flows using the indirect method, non-operating gains are added to net income.

The statement of cash flows reports:

A noncash investing transaction should be disclosed in either a footnote or at the bottom of the statement of cash flows.