Ch 11 Concept Video Acct 201-A

Pataasin ang iyong marka sa homework at exams ngayon gamit ang Quizwiz!

For the current year, Davis Corporation's statement of cash flows reveals the following information: Net cash flows from operating activities: $48,000 Net cash flows from investing activities: $12,000 Net cash flows from financing activities: $30,000 Cash at the end of the year: $ 210,000 What was the company's cash balance at the beginning of the year? $90,000 $120,000 $210,000 $300,000

$120,000

Wi-Fi, Inc., reported a net income of $50,000 for the current year. The beginning and ending balances for Retained Earnings for the year are $100,000 and $130,000 respectively. How much did Wi-Fi pay as dividends for the year? $20,000 $50,000 $30,000 $10,000

$20,000 feedback: Because net income is $50,000 and retained earnings increased by only $30,000, the company must have paid dividends of $20,000 during the year. The balance of Retained Earnings increases with net income and decreases with dividends.

Monterey Corporation reports net income of $260,000 that includes depreciation expense of $30,000 and amortization expense of $20,000. What is the company's cash inflows from operating activities? $210,000 $280,000 $290,000 $310,000

$310,000

Fallon Corporation reports net income of $370,000. Accounts Receivable balances at the beginning and end of the year were $40,000 and $48,000, respectively. Beginning and ending Inventory balances were $60,000 and $54,000, respectively. What is the company's cash inflows from operating activities? $356,000 $368,000 $372,000 $384,000

$368,000

Frederick Corporation reports net income of $410,000. Accounts Payable balances at the beginning and end of the year were $50,000 and $39,000, respectively. Interest Payable balances at the beginning and end of the year were $27,000 and $30,000, respectively. What is the company's cash inflows from operating activities? $396,000 $402,000 $418,000 $424,000

$402,000

Phillips Corporation reports net income of $480,000 that includes a gain on the sale of land of $8,000 and a loss on the sale of equipment of $2,000. What is the company's cash inflows from operating activities? $470,000 $474,000 $486,000 $490,000

$474,000

Identify investing activities from the items given below. (Select all that apply.) Collection of notes receivable Sale of property Issuance of bonds Purchase of equipment Receipt of interest Receipt of dividends

-Collection of notes receivable -Sale of property -Purchase of equipment

Which of the following is an example of a noncash activity? Purchase of investments with cash Reacquisition of a company's own stock from the market Purchase of long-term assets by issuing debt Sale of an intangible asset

-Issuance of notes payable -Repayment of bonds -Payment of dividends feedback:Issuance of notes payable, repayment of bonds, and payment of dividends are examples of financing activities. Lending with notes receivable is an investing activity and collection of accounts receivable is an operating activity.

For the current year, Klay Corporation reports the following information: Net cash inflows from investing activities: $40,000 Net cash inflows from financing activities: $45,000 Cash at the beginning of the year: $340,000 Cash at the end of the year: $420,000 What was the company's cash flows from operating activities? A cash inflow of $5,000 A cash inflow of $15,000 A cash outflow of $5,000 A cash outflow of $15,000

A cash outflow of $5,000

Croft Company sold land costing $10,000 for $12,000. In the investing activities section of the statement of cash flows, the company will report: An inflow of $2,000 An inflow of $12,000 An outflow of $10,000 An outflow of $12,000

An inflow of $12,000

The first step involved in preparing the statement of cash flows is: Multiple Choice Combine the operating, investing, and financing activities Determine net cash flows from financing activities Determine net cash flows from investing activities Determine net cash flows from operating activities

Determine net cash flows from operating activities

An increase in a current asset account, other than cash, results in an addition in calculating operating cash flows.

False

Nearly all major companies in the United States use the direct method to prepare the statement of cash flows.

False

Nonoperating items that increase net income, such as gains on the sale of fixed assets, must be added in calculating operating cash flows.

False

The statement of cash flows reports business activities on an accrual basis.

False

Both dividends paid and dividends declared during the year are reported in the statement of cash flows.

False feedback: Only the dividends actually paid in cash during the year are reported in the statement of cash flows. Note that the statement of cash flows reflects only actual cash flows.

Which of the following is an example of a cash outflow for a financing activity? Payment of cash for supplies Payment of cash for the purchase of equipment Payment of cash for interest expense Payment of cash for treasury stock

Payment of cash for treasury stock

Which of the following is an example of a noncash activity? Purchase of investments with cash Reacquisition of a company's own stock from the market Purchase of long-term assets by issuing debt Sale of an intangible asset

Purchase of long-term assets by issuing debt

Which of the following is an example of a cash inflow from an investing activity? Receipt of cash from customers Receipt of cash from the issuance of common stock Receipt of cash from the issuance of bonds Receipt of cash from the sale of equipment

Receipt of cash from the sale of equipment

A decrease in accounts payable results in a subtraction in calculating operating cash flows.

True

Depreciation expense is added back to net income in calculating operating cash flows.

True

Transactions that result in significant investing and financing activities but that do not involve cash are reported either directly after the statement of cash flows or in a note to the financial statements.

True

Under the indirect method, the operating activities section of the cash flow statement begins with net income.

True

The total net cash flows from operating activities are identical under both the indirect and direct methods.

True feedback:The total net cash flows from operating activities are identical under both methods.Note that the two methods differ only in presentation formats.

We determine the net cash flows from investing activities by analyzing changes in _____ accounts from the balance sheet. long-term asset current asset and current liability stockholders' equity long-term liability

long-term asset

The indirect method and the direct method affect only the ______ section of the statement of cash flows. operating activities financing activities investing activities noncash activities

operating activities feedback:Correct. The indirect method and the direct method differ only in the presentation format for preparing the operating activities section of the statement of cash flows.

Net cash flows from operating activities uses information from all of the following sources, except the _____. income statement current assets section of the balance sheet stockholders' equity section of the balance sheet current liabilities section of the balance sheet

stockholders' equity section of the balance sheet


Kaugnay na mga set ng pag-aaral

Adding and Subtracting Complex Numbers

View Set

International Business (Chapter 1-3)

View Set

Chapter 1: Units, Physical Quantities, and Vectors

View Set

4.07 Transform Linear Equations - Algebra

View Set

Email and Other Traditional Tools for Business Communication

View Set