Question 1

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

Accepted Answer

A) True 
 B)False

Question 2

Use the following information to calculate cash paid for salaries:

Accepted Answer

A)  $175,000.
B)  $183,000.
C)  $167,000.
D)  $143,000.
E)  $155,000.F) B) and C)
G) A) and B)

Question 3

The statement of cash flows explains how transactions and events impact the end-of-period cash balance to produce the end-of-period net income.

Accepted Answer

A) True 
 B)False

Question 4

Use the information provided to calculate the missing cash paid for merchandise for the period.

Accepted Answer

The answer of Use the information provided to calculate the...

Question 5

Activities that involve the production or purchase of merchandise and the sale of goods or services to customers,including expenditures related to administering the business.

Accepted Answer

A)  Financing activities
B)  Investing activities
C)  Statement of cash flows
D)  Indirect method
E)  Direct methodF) Operating activitiesG) A) and B)
H) E) and F)

Question 6

When analyzing the changes on a spreadsheet used to prepare a statement of cash flows,the cash flows from operating activities generally are affected by:

Accepted Answer

A)  Net income,current assets,and current liabilities.
B)  Noncurrent assets.
C)  Noncurrent liability and equity accounts.
D)  Both noncurrent assets and noncurrent liabilities.
E)  Equity accounts only.F) A) and C)
G) D) and E)

Question 7

When preparing the operating activities section of the statement of cash flows using the indirect method,decreases in current liabilities are subtracted from net income.

Accepted Answer

A) True 
 B)False

Question 8

When preparing a statement of cash flows using the indirect method,which of the following is correct?

Accepted Answer

A)  Proceeds from the sale of equipment should be added to net income in the operating activities section.
B)  A loss on the sale of land should be added to net income in the operating activities section.
C)  The declaration of a cash dividend should be a use of cash in the financing activities section.
D)  The issuance of a stock dividend should be a use of cash in the financing activities section.
E)  The purchase of land and a building by issuing a long-term note payable should be a source of cash in the financing activities section.F) A) and B)
G) C) and D)

Question 9

The reporting of net cash provided or used by operating activities that lists the major items of operating cash receipts,such as receipts from customers,and subtracts the major items of operating cash disbursements,such as cash paid for merchandise,is referred to as the:

Accepted Answer

A)  Direct method of reporting net cash provided or used by operating activities.
B)  Cash basis of accounting.
C)  Classified statement of cash flows.
D)  Indirect method of reporting net cash provided or used by operating activities.
E)  Net method of reporting cash flows from operating activities.F) A) and B)
G) All of the above

Question 10

The cash flow on total assets ratio is computed by dividing ________ by ________.

Accepted Answer

cash flows from oper...

Question 11

Investing activities include receiving cash dividends from stock investments.

Accepted Answer

A) True 
 B)False

Question 12

Define the cash flow on total assets ratio and explain how it is used to evaluate cash flows and to assess company performance.

Accepted Answer

The cash flow on total assets ratio is d...

Question 13

Information about cash flows influences decisions made by both internal and external users.

Accepted Answer

A) True 
 B)False

Question 14

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

Accepted Answer

A)  Operating activities.
B)  Financing activities.
C)  Investing activities.
D)  Schedule of noncash investing or financing activity.
E)  Reconciliation of cash balance.F) C) and D)
G) A) and C)

Question 15

The direct method for the preparation of the operating activities section of the statement of cash flows:

Accepted Answer

A)  Separately lists each major item of operating cash receipts and cash payments.
B)  Reports adjustments to reconcile net income to net cash provided or used by operating activities in the statement.
C)  Reports a different amount of cash flows from operations than if the indirect method is used.
D)  Is required if the company is a merchandiser.
E)  Is required by the FASB.F) B) and D)
G) D) and E)

Question 16

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

Accepted Answer

A) True 
 B)False

Question 17

A cash equivalent is:

Accepted Answer

A)  An investment readily convertible to a known amount of cash.
B)  Close to its maturity date but its market value may still be affected by interest rate changes.
C)  Generally within 3 years of its maturity date.
D)  Is not considered highly liquid.
E)  Another name for cash.F) A) and B)
G) A) and C)

Question 18

Which one of the following is an example of cash flows from operating activities?

Accepted Answer

A)  Proceeds from collecting the principal amounts of loans.
B)  Repayment of principals on loans.
C)  Proceeds from the issuance of bonds and notes payable.
D)  Payments to acquire equity securities of other companies.
E)  Receipts of cash from sales.F) All of the above
G) A) and B)

Question 19

The accountant for Crusoe Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available: 
-The amount of cash dividends paid during the year would be:

Accepted Answer

A)  $48,000.
B)  $46,000.
C)  $8,000.
D)  $64,000.
E)  $44,000.F) D) and E)
G) A) and E)

Question 20

The following selected account balances are taken from a merchandising company's records:
  (a)Calculate the cash payments made during Year 2 for merchandise.Assume all of the company's accounts payable balances result from merchandise purchases.
(b)Calculate the cash receipts from customer sales during Year 2.
(c)Calculate the cash payments for salaries during Year 2.

Accepted Answer

The answer of The following selected account balances are taken...

Exam 12: Reporting Cash Flows

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

Correct Answer
verified

Information about cash flows influences decisions made by both internal and external users.

Correct Answer
verified

The direct method for the preparation of the operating activities section of the statement of cash flows:

Correct Answer
verified

Use the information provided to calculate the missing cash paid for merchandise for the period.

Correct Answer
verified

When preparing the operating activities section of the statement of cash flows using the indirect method,decreases in current liabilities are subtracted from net income.

Correct Answer
verified

Investing activities include receiving cash dividends from stock investments.

Correct Answer
verified

Activities that involve the production or purchase of merchandise and the sale of goods or services to customers,including expenditures related to administering the business.

Correct Answer
verified

When preparing a statement of cash flows using the indirect method,which of the following is correct?

Correct Answer
verified

Define the cash flow on total assets ratio and explain how it is used to evaluate cash flows and to assess company performance.

Correct Answer
verified
The cash flow on total assets ratio is d...
View Answer

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

Correct Answer
verified

The reporting of net cash provided or used by operating activities that lists the major items of operating cash receipts,such as receipts from customers,and subtracts the major items of operating cash disbursements,such as cash paid for merchandise,is referred to as the:

Correct Answer
verified

When analyzing the changes on a spreadsheet used to prepare a statement of cash flows,the cash flows from operating activities generally are affected by:

Correct Answer
verified

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

Correct Answer
verified

Correct Answer
verified

The statement of cash flows explains how transactions and events impact the end-of-period cash balance to produce the end-of-period net income.

Correct Answer
verified

Use the following information to calculate cash paid for salaries:

Correct Answer
verified

The accountant for Crusoe Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available: -The amount of cash dividends paid during the year would be:

Correct Answer
verified

A cash equivalent is:

Correct Answer
verified

Which one of the following is an example of cash flows from operating activities?

Correct Answer
verified

The cash flow on total assets ratio is computed by dividing by .

Correct Answer
verified
cash flows from oper...
View Answer

Exam 12: Reporting Cash Flows

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

Correct AnswerverifiedShow Answer

Information about cash flows influences decisions made by both internal and external users.

Correct AnswerverifiedShow Answer

The direct method for the preparation of the operating activities section of the statement of cash flows:

Correct AnswerverifiedShow Answer

Use the information provided to calculate the missing cash paid for merchandise for the period.

Correct AnswerverifiedShow Answer

When preparing the operating activities section of the statement of cash flows using the indirect method,decreases in current liabilities are subtracted from net income.

Correct AnswerverifiedShow Answer

Investing activities include receiving cash dividends from stock investments.

Correct AnswerverifiedShow Answer

Activities that involve the production or purchase of merchandise and the sale of goods or services to customers,including expenditures related to administering the business.

Correct AnswerverifiedShow Answer

When preparing a statement of cash flows using the indirect method,which of the following is correct?

Correct AnswerverifiedShow Answer

Define the cash flow on total assets ratio and explain how it is used to evaluate cash flows and to assess company performance.

Correct AnswerverifiedThe cash flow on total assets ratio is d...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

The reporting of net cash provided or used by operating activities that lists the major items of operating cash receipts,such as receipts from customers,and subtracts the major items of operating cash disbursements,such as cash paid for merchandise,is referred to as the:

Correct AnswerverifiedShow Answer

When analyzing the changes on a spreadsheet used to prepare a statement of cash flows,the cash flows from operating activities generally are affected by:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The statement of cash flows explains how transactions and events impact the end-of-period cash balance to produce the end-of-period net income.

Correct AnswerverifiedShow Answer

Use the following information to calculate cash paid for salaries:

Correct AnswerverifiedShow Answer

The accountant for Crusoe Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available: -The amount of cash dividends paid during the year would be:

Correct AnswerverifiedShow Answer

A cash equivalent is:

Correct AnswerverifiedShow Answer

Which one of the following is an example of cash flows from operating activities?

Correct AnswerverifiedShow Answer

The cash flow on total assets ratio is computed by dividing ________ by ________.

Correct Answerverifiedcash flows from oper...View AnswerShow Answer

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The cash flow on total assets ratio is d...
View Answer

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The cash flow on total assets ratio is computed by dividing by .

Correct Answer
verified
cash flows from oper...
View Answer