Acct. 2 Ch. 13

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what section would the following transaction appear in or relate to, if any, on a statement of cash flows Sold long-term investment.

Investing activities section

what section would the following transaction appear in or relate to, if any, on a statement of cash flows Converted loans payable to stock.

Schedule of noncash investing and financing transactions

Analysis of the financing activities section of the statement of cash flows will disclose

any sales or repurchases of stock.

In preparing a statement of cash flows using the indirect method, an increase in an unearned revenue account should

be shown as an addition to net income in computing net cash flows from operating activities.

If the indirect method is used to prepare a statement of cash flows, which of the following would be added to net income to arrive at net cash flows from operating activities?

decrease in prepaid expenses

what section would the following transaction appear in or relate to, if any, on a statement of cash flows Issued common stock for cash

financing activities section

what section would the following transaction appear in or relate to, if any, on a statement of cash flows Retired long-term debt with cash.

financing activities section

When a statement of cash flows is prepared using the indirect method,

net income is the starting point in determining cash flows from operations

The calculation of free cash flow could include all of the following except

net income.

To determine whether a company's operations are covering its dividend payments, it is best to focus on which of the following sections of the statement of cash flows?

operating activities

what section would the following transaction appear in or relate to, if any, on a statement of cash flows Issued stock for equipment.

Schedule of noncash investing and financing transactions

The primary purpose of the statement of cash flows is to provide information.

about a company's cash receipts and cash payments during an accounting period.

assume the indirect method is used to compute net cash flows from operating activities. For this item extracted from the financial statements-Increase in A/R- indicate the effect on net income in arriving at net cash flows from operating activities by choosing one of the following:

add to net income to arrive at net cash flows from operating activities

assume the indirect method is used to compute net cash flows from operating activities. For this item extracted from the financial statements-decrease in prepaid expenses- indicate the effect on net income in arriving at net cash flows from operating activities by choosing one of the following:

add to net income to arrive at net cash flows from operating activities

assume the indirect method is used to compute net cash flows from operating activities. For this item extracted from the financial statements-increase in accrued liabilities- indicate the effect on net income in arriving at net cash flows from operating activities by choosing one of the following:

add to net income to arrive at net cash flows from operating activities

what section would the following transaction appear in or relate to, if any, on a statement of cash flows Declared and issued a stock dividend.

does not represent a cash flow.

Elkwood Corporation acquired a land site with a building by issuing a 30-year mortgage payable. In Elkwood's statement of cash flows, this transaction should be shown

in the schedule of noncash investing and financing transactions

If the indirect method is used to prepare a statement of cash flows, which of the following would be deducted from net income to arrive at net cash flows from operating activities?

increase in accounts receivable

assume the indirect method is used to compute net cash flows from operating activities. For this item extracted from the financial statements-Increase in inventory- indicate the effect on net income in arriving at net cash flows from operating activities by choosing one of the following:

subtract from net income to arrive at net cash flows from operating activities

assume the indirect method is used to compute net cash flows from operating activities. For this item extracted from the financial statements-decrease in accounts payable- indicate the effect on net income in arriving at net cash flows from operating activities by choosing one of the following:

subtract from net income to arrive at net cash flows from operating activities


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