Acct Mod 7

B. source; subtracted from

A decrease in a current asset is a ______ of cash and is ______ expenses to arrive at cash paid. A. source; added to B. source; subtracted from C. use; added to D. use; subtracted from

C. use; added to

A decrease in current liabilities is a ______ of cash and is ______ expenses to arrive at cash paid. A. source; added to B. source; subtracted from C. use; added to D. use; subtracted from

A. proceeds from the sale of equipment *letters not consistent

A source of cash for investing activities is ______. A. proceeds from the sale of equipment B. proceeds from a loan C. proceeds from reissuance of treasury stock D. purchase of equipment

B. payment of an account payable *letters not consistent

A use of cash for operating activities is ______. A. payment of dividends B. payment of an account payable C. cash used to buy equipment D. cash used to purchase treasury stock

D. Cash paid for insurance of $11,400 *letters not consistent (yr1 prepaid ins - yr2 prepaid ins + insur exp)

ABC Company uses the Direct method to prepare its statement of cash flows. Presented below are selected items from its financial statements. Which of the following would be shown in the Operating Activities section related to insurance? A. $1,800 would be subtracted from net income B. $1,800 would be added to net income C. Cash paid for insurance of $15,000 D. Cash paid for insurance of $11,400

D. Cash paid for interest of $15,900

ABC Company uses the direct method to prepare its statement of cash flows. Presented below are selected items from its financial statements. Which of the following would be shown in the Operating Activities section related to interest? A. $3,100 would be subtracted from net income B. $3,100 would be added to net income C. Cash paid for interest expense of $22,100 D. Cash paid for interest of $15,900

D. Cash paid to employees of $112,500 (yr2 wages pay - yr1 wages pay + wages exp)

ABC Company uses the direct method to prepare its statement of cash flows. Presented below are selected items from its financial statements. Which of the following would be shown in the Operating Activities section related to wages? A. $2,500 would be added to net income B. Cash paid to employees of $107,500 C. $2,500 would be subtracted from net income D. Cash paid to employees of $112,500

D. $1,800 would be added to net income

ABC Company uses the indirect method to prepare its statement of cash flows. Present below are selected items from its financial statements. Which of the following would be shown in the Operating Activities section related to insurance? A. Cash paid for insurance of $15,000 B. Cash paid for insurance of $11,400 C. $1,800 would be subtracted from net income D. $1,800 would be added to net income

A. $1,800 would be added to net income

ABC Company uses the indirect method to prepare its statement of cash flows. Present below are selected items from its financial statements. Which of the following would be shown in the Operating Activities section related to insurance? A. $1,800 would be added to net income B. $1,800 would be subtracted from net income C. Cash paid for insurance of $15,000 D. Cash paid for insurance of $11,400

D. use; subtracted from *letters consistent

An increase in Accounts Receivable is a ______ of cash and is ______ Revenues to arrive at Cash Collected from Customers. A. source; added to B. source; subtracted from C. use; added to D. use; subtracted from

A. source; added to *letters consistent

An increase in Deferred Revenue is a ______ of cash and is ______ Revenues to arrive at Cash Collected from Customers. A. source; added to B. source; subtracted from C. use; added to D. use; subtracted from

C. use; added to *letters consistent

An increase in a current asset is a ______ of cash and is ______ expenses to arrive at cash paid. A. source; added to B. source; subtracted from C. use; added to D. use; subtracted from

B. source; subtracted from

An increase in accrued liabilities is a ______ of cash and is ______ expenses to arrive at cash paid. A. source; added to B. source; subtracted from C. use; added to D. use; subtracted from

B. source; subtracted from

An increase in current liabilities is a ______ of cash and is ______ expenses to arrive at cash paid. A. source; added to B. source; subtracted from C. use; added to D. use; subtracted from

Revenue on the Income Statement: C. $400,000 Cash Collected from Customers on the Statement of Cash Flows: B. $405,000

Beauty and the Beach, Inc., earned $400,000 during its 4th year of business. Its Accounts Receivable balances were $15,000 at the end of year 3 and $10,000 at the end of year 4. Match the amounts that will be reported on each of the 4th year financial statements listed below. Revenue on the Income Statement: Cash Collected from Customers on the Statement of Cash Flows: A. $395,000 B. $405,000 C. $400,000 D. $415,000 E. $385,000

C. financing activity *letters consistent

Borrowing from a bank is a(n) ______. A. operating activity B. investing activity C. financing activity D. expense

C. $3,100 would be added to net income

Cycle Path, Inc. uses the indirect method to prepare its statement of cash flows. Present below are selected items from its financial statements. Which of the following would be shown in the Operating Activities section related to interest? A. Cash paid for interest of $10,100 B. $3,100 would be subtracted from net income C. $3,100 would be added to net income D. Cash paid for interest of $16,300

D. $1,500 would be subtracted from net income (yr1 wages pay - yr2 wages pay)

Cycle Path, Inc. uses the indirect method to prepare its statement of cash flows. Presented below are selected items from its financial statements. Which of the following would be shown in the Operating Activities section related to wages? A. Cash paid for wages of $96,500 B. $1,500 would be added to net income C. Cash paid for wages of $99,500 D. $1,500 would be subtracted from net income

Revenue on the Income Statement: C. $400,000 Cash Collected from Customers on the Statement of Cash Flows: B. $395,000 *letters consistent (10,000 - 15,000 + 400,000)

Faux Sure, Inc., earned $400,000 during its 4th year of business. Its Accounts Receivable balances were $10,000 at the end of year 3 and $15,000 at the end of year 4. Match the amounts that will be reported on each of the 4th year financial statements listed below. Revenue on the Income Statement: Cash Collected from Customers on the Statement of Cash Flows: A. $405,000 B. $395,000 C. $400,000 D. $415,000 E. $385,000

C. $5,900

Frisky Business's Statement of Cash Flows for the year ended showed the following: Cash Flows from Financing Activities were ______. A. $5,700 B. $9,100 C. $5,900 D. $1,900

Acct Rec: D. Balance Sheet Cash Coll Fm Cust: C. Statement of Cash Flows Sales Rev: A. Income Statement

Indicate the financial statement where you would expect to find each line item: Acct Rec: Cash Coll Fm Cust: Sales Rev: A. Income Statement B. Statement of Shareholders' Equity C. Statement of Cash Flows D. Balance Sheet

Deferred Revenue: D. Balance Sheet Cash Collected from Customers: C. Statement of Cash Flows Sales Revenue: A. Income Statement

Indicate the financial statement where you would expect to find each line item: Deferred Revenue: Cash Collected from Customers: Sales Revenue: A. Income Statement B. Statement of Shareholders' Equity C. Statement of Cash Flows D. Balance Sheet

Wages Expense: A. Income Statement Wages Paid to Employees: C. Statement of Cash Flows Wages Payable: D. Balance Sheet *letters consistent

Indicate the financial statement where you would expect to find each line item: Wages Expense: Wages Paid to Employees: Wages Payable: A. Income Statement B. Statement of Shareholders' Equity C. Statement of Cash Flows D. Balance Sheet

Purchased $100,000 of land.: B. Investing Activity Paid $200 for supplies to be used on customers over the next two months.: A. Operating Activity Received $500 from its customers.: A. Operating Activity

Indicate whether each activity for Anudu Hair Salon would be classified as an operating, investing, or financing activity. Purchased $100,000 of land.: Paid $200 for supplies to be used on customers over the next two months.: Received $500 from its customers.: A. Operating Activity B. Investing Activity C. Financing Activity

Received $40,000 from its owners in exchange for stock.: C. Financing Activity Purchased a barber's chair and sink for $35,000.: B. Investing Activity Paid $100 for advertising in the local paper.: A. Operating Activity

Indicate whether each activity for Anudu Hair Salon would be classified as an operating, investing, or financing activity. Received $40,000 from its owners in exchange for stock.: Purchased a barber's chair and sink for $35,000.: Paid $100 for advertising in the local paper.: A. Operating Activity B. Investing Activity C. Financing Activity

Issued $10,000 of stock.: C. Financing Activity Purchased $1,000 of inventory.: A. Operating Activity Purchased land for $1,000.: B. Investing Activity *letters consistent

Indicate whether each activity for Hot Diggity Dogs, Inc., would be classified as an operating, investing, or financing activity. Issued $10,000 of stock.: Purchased $1,000 of inventory.: Purchased land for $1,000.: A. Operating Activity B. Investing Activity C. Financing Activity

C. Cash paid for wages of $99,500 *letters not consistent (yr2 wages pay - yr1 wages pay + wages exp)

Johnson Corporation Company uses the Direct method to prepare its statement of cash flows. Presented below are selected items from its financial statements. Which of the following would be shown in the Operating Activities section related to wages? A. Cash paid for wages of $96,500 B. $1,500 would be subtracted from net income C. Cash paid for wages of $99,500 D. $1,500 would be added to net income

Reports the amount of supplies used during the period.: A. Income Statement Reports the amount of supplies on hand at the end of the period.: C. Balance Sheet Reports the amount paid for supplies during the period.: B. Statement of Cash Flows

Match each description with the appropriate financial statement. Reports the amount of supplies used during the period.: Reports the amount of supplies on hand at the end of the period.: Reports the amount paid for supplies during the period.: A. Income Statement B. Statement of Cash Flows C. Balance Sheet

C. financing activity *letters consistent

Paying a cash dividend to shareholders is a(n) ______. A. operating activity B. investing activity C. financing activity D. expense

1. A. Operating Activities 2. B. Investing Activities 3. C. Financing Activities 4. D. Change in Cash

Place the following items in the order that they would appear on a statement of cash flows. A. Operating Activities B. Investing Activities C. Financing Activities D. Change in Cash

Revenue on the Income Statement: C. $300,000 Cash Collected from Customers on the Statement of Cash Flows: D. $305,000 Deferred Revenue on the Balance Sheet: B. $25,000 *letters consistent

Sea the World Cruises earned $300,000 of the amount collected in advance from customers during its 3rd month of business. It started the month with $20,000 in Deferred Revenue and ended the month with $25,000. Match the amounts that will be reported on each of the first month's financial statements listed below. Revenue on the Income Statement: Cash Collected from Customers on the Statement of Cash Flows: Deferred Revenue on the Balance Sheet: A. $0 B. $25,000 C. $300,000 D. $305,000

A. Issued a note payable C. Issued stock *letters not consistent

Select the financing activities from the list below. (Select all that apply.) A. Issued a note payable B. Purchased land C. Issued stock D. Purchased equipment

A. starts by converting every number on the income statement to its cash amount

The direct method for the preparation of the Statement of Cash Flows ______. A. starts by converting every number on the income statement to its cash amount B. starts with net income and makes adjustments for all the items that are not cash C. affects the investing and financing activities sections of the Statement of Cash Flows D. starts by estimating the sources of cash and the uses of cash

B. with net income and makes adjustments for all the items that are not cash

The indirect method for the preparation of the Statement of Cash Flows starts ______. A. by estimating the sources of cash and the uses of cash B. with net income and makes adjustments for all the items that are not cash C. affects the investing and financing activities sections of the Statement of Cash Flows D. with cash collected from customers E. by converting every number on the income statement to its cash amount

B. cash collected and cash paid during the period

The statement of cash flows reports the ______. A. revenues minus expenses for the accounting period B. cash collected and cash paid during the period C. economic resources, obligations, and net worth D. changes that occurred in shareholders' equity during the accounting period

False

True or False: Revenue on the income statement always equals Cash Collected on the statement of cash flows during the accounting period.

B. $3,000 (2000 + 7000 - 6000)

Using the information found in the financial statements for the month ended May 31 and the Accounts Receivable T-account, determine its May 31 balance found on the balance sheet. Assume all sales are on account. Balance Sheet at April 30: Accounts Receivable = $2,000 Statement of Cash Flows: Cash Collected from Customers on the Statement of Cash Flows = $6,000 Income Statement: Sales = $7,000 Balance Sheet at May 31: Accounts Receivable = ______? A. $1,000 B. $3,000 C. $9,000 D. $6,000

[A] 0 [B] 400 [C] 700 [D] 600 [E] 0 [F] 300

Using the information found in the financial statements for the month ended May 31, fill in the Deferred Revenue ledger account below. Cash Collected from Customers on the Statement of Cash Flows equals $600 for the month ended May 31. All cash was collected in advance. Service Revenue on the Income Statement equals $700 for the month ended May 31. The amount collected in advance but not yet earned on the Balance Sheet equals $300 at May 31. The May 1 beginning balance must be determined and entered at the top of the T account in either the a. or b. blank. Put "0" in the blank on the opposite side. When entering the ending balance in either the e. or f. blank, be sure to enter "0" in the blank on the opposite side. When entering the activity for the month, use blanks c. and d. (not a. or b.)

C. Statement of Cash Flows

Which financial statement reports how much cash was collected from customers? A. Income Statement B. Statement of Shareholders' Equity C. Statement of Cash Flows D. Balance Sheet

C. Statement of Cash Flows *letters consistent

Which financial statement reports how much cash was paid for inventory? A. Income Statement B. Statement of Shareholders' Equity C. Statement of Cash Flows D. Balance Sheet

B. Cash paid to buy equipment

Which item would be reported as a cash flow from investing activities? A. Cash dividends paid to shareholders B. Cash paid to buy equipment C. Cash received from customers D. Cash borrowed from the bank

A. Cash collected from customers C. Cash paid to employees D. Cash paid to suppliers *letters not consistent, anything beginning with "cash"

Which of the following would be included in the operating activity section of the Statement of Cash Flows? (Select all that apply.) A. Cash collected from customers B. Purchase of land C. Cash paid to employees D. Cash paid to suppliers E. Purchase of a new office building

E. Both A and C *letters consistent

Which of the following would be presented on a statement of cash flows using the direct method? A. Cash paid for interest B. Increase in accounts receivable C. Proceeds from the sale of land D. Both A and B E. Both A and C

D. Both A and B *letters consistent

Which of the following would be presented on a statement of cash flows using the indirect method? A. Cash proceeds from sale of land B. Gain on sale of land C. Cash paid for interest D. Both A and B E. Both A and C

B. Cash paid to buy equipment C. Cash paid to build a new corporate headquarters *letters not consistent (A. Cash received from owners in exchange for stock = financing; D. Cash paid for advertising, E. Cash paid for employee wages, F. Cash paid for rent = operating)

Which of these would be reported as cash flows from investing activities? (Select all that apply.) A. Cash received from owners in exchange for stock B. Cash paid to buy equipment C. Cash paid to build a new corporate headquarters D. Cash paid for advertising E. Cash paid for employee wages F. Cash paid for rent

A. Cash paid to reduce the principal borrowed from banks B. Cash borrowed from the bank D. Cash dividends paid to shareholders *letters not consistent (C. Cash paid to buy land = investing; E. Cash paid to buy computers = operating)

Which of these would be reported in the financing activities section of the Statement of Cash Flows? (Select all that apply.) A. Cash paid to reduce the principal borrowed from banks B. Cash borrowed from the bank C. Cash paid to buy land D. Cash dividends paid to shareholders E. Cash paid to buy computers

F. Operating

Which section(s) of the statement of cash flows differ(s) using the direct method rather than the indirect method. A. Operating, Investing, and Financing B. Financing C. Investing and Financing D. Investing E. Operating and Financing F. Operating

operating

______ activities are involved with providing goods and services to the customer.