accounting

Question Content Area Land costing $140,000 was sold for $173,000 cash. The gain on the sale was reported on the income statement as other income. On the statement of cash flows, what amount should be reported as an investing activity from the sale of land?

$140,000

Question Content Area The following information is available from the current period financial statements: Net income$175,000 Depreciation expense28,000 Increase in accounts receivable16,000 Decrease in accounts payable21,000 The net cash flow from operating activities using the indirect method is

$166,000

If a gain of $11,000 is realized in selling (for cash) office equipment having a book value of $55,000, the total amount reported in the cash flows from investing activities section of the statement of cash flows is

$66,000

Comparative financial statements are designed to compare the financial statements of two or more corporations.

False

In horizontal analysis, the current year is the base year.

False

Which of the following should be added to net income in calculating net cash flow from operating activities using the indirect method?

a decrease in accounts receivable

In a vertical analysis, the base for cost of goods sold ishe

base year figure

The statement of cash flows is not useful for

calculating the net worth of a company

Question Content Area Which of the following would not be on the statement of cash flows?

cash flows from contingent activities

Which of the following can be found on the statement of cash flows?

cash flows from operating activities

Question Content Area Which of the following is the most useful in analyzing companies of different sizes?

common-sized financial statements

Which of the following measures a company's ability to pay its current liabilities?

current ratio

Which of the following does not represent an outflow of cash and therefore would not be reported on the statement of cash flows as a use of cash?

discarding an asset that had been fully depreciated

Cash paid for preferred stock dividends should be shown on the statement of cash flows under

financing activities

Which of the following should be deducted from net income in calculating net cash flow from operating activities using the indirect method?

gain on sale of land

Question Content Area The percentage analysis of increases and decreases in individual items in comparative financial statements is called

horizontal analysis

Question Content Area Equipment with an original cost of $75,000 and accumulated depreciation of $20,000 was sold at a loss of $7,000. As a result of this transaction, cash would

increase by $48,000

Question Content Area A company purchases equipment for $32,000 cash. This transaction should be shown on the statement of cash flows under

investing activities

One reason that a common-sized statement is a useful tool in financial analysis is that it enables the user to

make a better comparison of two companies of different sizes in the same industry

Question Content Area The order of presentation of activities on the statement of cash flows is

operating, investing, and financing

Question Content Area Horizontal analysis is a technique for evaluating financial statement data

over a period of time

In a vertical analysis, the base for cost of goods sold is

sales

Question Content Area In a common-sized income statement, 100% is the

sales

Question Content Area The ability of a business to pay its debts as they come due and to earn a reasonable net income is

solvency and profitability

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

statement of changes in financial position

Cash paid for equipment would be reported on the statement of cash flows in

the cash flows from investing activities section

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

the cash flows from investing activities section

Depreciation on factory equipment would be reported in the statement of cash flows prepared by the indirect method in

the cash flows from operating activities section

Question Content Area In a common-sized balance sheet, 100% is

total assets

Percentage analyses, ratios, turnovers, and other measures of financial position and operating results are

useful analytical measures

An analysis in which all the components of an income statement are expressed as a percentage of sales is a

vertical analysis

The percent of fixed assets to total assets is an example of

vertical analysis

Question Content Area Which of the following increases cash?

a.borrowing money by issuing a six-month note b.the declaration of a cash dividend d.acquisition of treasury stock one of these

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

a.payments for the acquisition of investments b.receipts from the issuance of common stock c.cash receipts from sales of merchandise one of these

Question Content Area A building with a book value of $54,000 is sold for $63,000 cash. Using the indirect method, this transaction should be shown on the statement of cash flows as follows:

an increase of $54,000 from investing activities and an addition to net income of $9,000