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Exam 14: Statement of Cash Flows

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Question 41

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The net income reported on the income statement for the current year was $58,000. Depreciation recorded on fixed assets for the year was $24,000. In addition, equipment with an original cost of $130,000 and accumulated depreciation of $115,000 on the date of the sale, was sold for $20,000. Balances of the current asset and current liability accounts at the end and beginning of the year are listed below. Prepare the cash flows from operating activities section of a statement of cash flows using the indirect method.

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Cash flows from operating activities:
Ne...

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Question 42

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Based on the following, what is free cash flow? Net cash flow from operating activities $318,000 Net cash flow used for investing activities 30,000)Net cash flow from financing activities 30,000 Cash flows from operations include $2,000 for depreciation. Cash flows from investing include the purchase of a replacement asset for $100,000 and the sale of the one used in production, which is now obsolete, for $70,000. Cash flows from financing include $70,000 of borrowing.

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$318,000 -...

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Question 43

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Balances of the current asset and current liability accounts at the end and beginning of the year are as follows: Use the direct method to prepare the cash flows from operating activities section of a statement of cash flows.

Cash dividends of $50,000 were declared during the year. Cash dividends payable were $10,000 and $5,000 at the beginning and end of the year, respectively. The amount of cash for the payment of dividends during the year is

Cash receipts received from the issuance of a mortgage notes payable would be classified as an)

Which of the following increases cash?

Which of the following should be shown on a statement of cash flows under the financing activities section?

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.

Which of the following is not one of the four basic financial statements?

Cash paid to purchase long-term investments would be reported in the statement of cash flows in

Cash outflows from financing activities include the payment of cash dividends, the acquisition of treasury stock, and the repayment of amounts borrowed.

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: Required: Prepare the Cash Flows from Operating Activities section of the statement of cash flows, using the indirect method.

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

To determine cash payments for operating expenses for the statement of cash flows using the direct method, a decrease in prepaid expenses is added to operating expenses other than depreciation.

The direct method of preparing the operating activities section of the statement of cash flows reports major classes of cash receipts and cash payments related to the day-to-day operations of the business.

Cash collections from customers were

For each of the following activities that may take place during the accounting period, indicate the effect a-g) on the statement of cash flows prepared using the indirect method. Choices may be selected as the answer for more than one question. -amortization of intangible assets

On the basis of the following data for Breach Co. for the current and preceding years ended December 31, prepare a statement of cash flows using the indirect method. Assume that equipment costing $25,000 was purchased for cash and no long term assets were sold during the period. Stock was issued for cash-3,200 shares at par. Net income for the current year was $76,000. Cash dividends declared and paid were $13,000.

Identify the section of the statement of cash flows a-d) where each of the following items would be reported. -Exchange of land for note payable

Cash inflows and outflows are not netted in the investing or financing sections of the statement of cash flows but are separately disclosed to give the reader full information.