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Exam 24: The Statement of Cash Flows

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Question 71

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The schedule of----------- supplements the income statement, showing selling and administrative expenses in greater detail.

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Question 72

Multiple Choice

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A list of sources and uses of cash are given below. Indicate on the line provided whether each is an (O) operating, (I) investing, (F) financing, or a significant (N) noncash financing and investing activity. -purchased land in exchange for a note payable

A) (O) operating
B) (I) investing
C) (F) financing, or a significant
D) (N) noncash financing and investing activity.

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

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Question 73

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The purchase or resale of treasury stock is reported in which section of the statement of cash flows?

In computing the cash flows from operating activities section, a loss from the sale of long-term assets must be deducted from net income.

The Natural Company's cash balance at December 31, 2019, was $150,000. The following information was reported on the company's statement of cash flows for 2020: - The Natural Company's Statement of Cash Flows would report Cash Flows from Investing Activitie totaling:

Explain the differences between the direct and the indirect methods of preparing the operating activities section of the statement of cash flows.

A list of sources and uses of cash are given below. Select on the line provided whether each is an operating, investing, or financing activity. -dividends paid

Current assets and current liabilities are often referred to as operating assets and liabilities.

For each of the following operating activities, select whether it is a source of cash, a use of cash or neither under the indirect method. -increase in Accumulated Depreciation

A list of sources and uses of cash are given below. Indicate on the line provided whether each is an:

For each of the following operating activities, select whether it is a source of cash, a use of cash or neither under the indirect method. -increase in Inventory

Why is the Statement of Cash Flows important?

The statement of cash flows assumes that the----------- basis of accounting is used when recording transactions and preparing the balance sheet and income statement.

The payment of bonds at maturity would be treated as a cash--------- in the----------- section of the statement of cash flows.

On the statement of cash flows, the cash flows from operating activities section include:

Operating activities include all except:

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

When the----------- method of preparing the statement of cash flows is used, the interest and income taxes paid during the period are disclosed in notes accompanying the statement.

The following transactions occurred at the Lionel Corporation in 2019. Use this information to prepare Lionel's schedule of cash flows from investing activities. A)The company sold a used truck for $6,500 in cash. The original cost of the truck was $22,000. Depreciation of $16,000 had been deducted. B)The company purchased some new equipment for $36,000.

The Natural Company's cash balance at December 31, 2019, was $150,000. The following information was reported on the company's statement of cash flows for 2020: - The Natural Company's Statement of Cash Flows would report Cash Flows from Operating Activities of: