FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 21: The Statement of Cash Flows

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 1

Multiple Choice

Review LaterAdd Note

Review Later

Moon Company owns 56 million shares of stock of Center Company classified as available for sale.During 2016,the fair value of those shares increased by $34 million.What effect did this increase have on Moon's 2016 statement of cash flows?

A) Cash from operating activities increased.
B) Cash from investing activities increased.
C) Cash from financing activities increased.
D) No effect.

E) A) and B)
F) B) and C)

Correct Answer

verified

Show Answer

Question 2

Multiple Choice

Review LaterAdd Note

Review Later

Which of the following is reported as an operating activity in the statement of cash flows?

A) The purchase of long-lived assets.
B) The acquisition of treasury stock.
C) The retirement of bonds.
D) The payment of prepaid insurance.

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

Correct Answer

verified

Show Answer

Question 3

True/False

Review LaterAdd Note

If the direct method is used to report cash flows from operating activities in the body of the statement of cash flows,a reconciliation of net income to net cash flows from operating activities also is required.

Which of the following would not be a cash inflow from financing activities?

Interest payments to creditors are reported in a statement of cash flows as:

On December 31,2016,Wellstone Company reported net income of $70,000 and sales of $210,000.The company also reported beginning and ending accounts receivable at $20,000 and $25,000,respectively.Wellstone will report cash collected from customers in its 2016 statement of cash flows (direct method) in the amount of:

When a company purchases a security it considers a cash equivalent,the cash outflow is:

Determine the amount of cash received from customers for each of the two independent situations below.

Determine the amount of cash paid to suppliers for each of the four independent situations below.

Property dividends distributed are reported in connection with a statement of cash flows as:

Partial balance sheets for ABC Company and additional information are provided below. Additional information for 2016: July 1: Issued 8,000 shares of common stock for cash. July 1: Purchased new equipment for cash. December 31: Paid cash dividends of $20,000. Required: Prepare the financing activities section of the statement of cash flows for 2016.

Listed below are the reporting classifications for a statement of cash flows using the direct method for reporting operating cash flows.Indicate the reporting classification that would apply to each of the five transactions described below by placing the number of the reporting classification in the space provided by each transaction.

Which of the following would be reported as a cash outflow from investing activities?

Which of the following financial statements is prepared as of a particular point in time rather than for a period of time?

Selected information from Large Corporation's accounting records and financial statements for 2016 is as follows ($ in millions) : Large prepares its financial statements in accordance with IFRS.In its statement of cash flows,Large most likely reports net cash outflows from investing activities of:

Do the statement of cash flows and its related disclosure note report only transactions that cause an increase or decrease in cash? Explain.

Which of the following would not be a component of cash flows from investing activities?

Listed below are several transactions that typically produce either an increase or a decrease in cash.Indicate by letter whether the cash effect of each transaction is reported on a statement of cash flows as an operating (O),investing (I),or financing (F)activity. Transactions _ Sale of preferred stock ____ Sale of equipment ____ Purchase of treasury stock ____ Merchandise sales ____ Issuance of a short-term note payable ____ Purchase of inventory ____ Repayment of note payable ____ Employee salaries ____ Sale of land ____ Issuance of bonds ____ Acquisition of bonds of another corporation ____ Payment of semiannual interest on bonds payable ____ Payment of a cash dividend ____ Purchase of an office building ____ Collection of nontrade note receivable (principal amount) ____ Loan to another firm ____ Retirement of common stock ____ Payment of income taxes ____ Issuance of a long-term note payable ____ Sale of a patent

The following are comparative balance sheets and an income statement for Wentworth Company. Cash dividends of $45,000 were paid in 2016. Required: Prepare a statement of cash flows for 2016 using the direct method.

The primary objective of the statement of cash flows is to provide information about a company's: