Ch. 6
What are current assets for San Marcos Corporation?
1,033 / 918
Which of the following statement describes the concept of liquidity
Measure of an asset's ability to be quickly converted to cash without risk of loss
Which of the following is not a cash equivalent?
bond sinking fund
Which of the following is considered a financing activity when preparing the statement of cash flows?
cash receipt from the sale of common stock
If an auditor is not able to gather enough evidence to form an opinion on financial statement the auditor issues a
disclaimer of opinion
Which of the following is classified as an operating activity on a statement of cashflows?
purchase of inventory with cash
nvestments are treasury bills that were purchased in May and mature on August 15. Prepaid insurance is a threeminus−year policy that was purchased on July 31.
142,500
What amount should the Black Knights Company report as cash paid to suppliers in its cash flow statement, prepared under the direct method?
330,000
Presented here are cash flows (in $ Millions) for Valley Mills Enterprises' most recent fiscal year. Net cash flows provided (used) by operating activities (direct method) are________.
55 /1100
When preparing the operating section of the statement of cash flows using the indirect method, which of the following items are added to net income?
Bad debt expense
Which of the following items would not be included in the operation activities section of an entity's statement of cash flow under US GAAP ?
Dividend paid
Accumulated other comprehensive income appear on the entity's income statement
False
Which of the following would probably not be a related party?
a customer
What amount should Vegas report as cash received from customers in its current year statement of cash flows prepared using the direct method?
1,110,000
The amount that should be classified as current liabilities on Glover's December 31 balance sheet is ________.
101,000
Sykes Corporation's comparative balance sheets at December 31, Year 2 and Year 1 reported accumulated depreciation balances of $800,000 and $600,000 respectively. Property with a cost of $50,000 and a carrying amount of $40,000 was the only property sold in Year 2. Depreciation charged to operations in Year 2was:
210,000
Danielsen Inc. had salaries payable of $ 40 comma 000$40,000 as of January 1 and $ 20 comma 000$20,000 as of December 31. During the year, Danielsen showed $ 650 comma 000$650,000 in salaries expense on the income statement. Cash outflows for salaries for the year were ________.
670,000
During Year 1, Brianna Company had the following transactions related to its financial operations: Payment for the retirement of long-term bonds payable (carrying value $740,000) $ 750,000 Distribution in Year 1 of cash dividend declared in Year 0 to preferred shareholders 62,000 Carrying value of convertible preferred stock of Brianna converted into common shares 120,000 Proceeds from sale of treasury stock (carrying value at cost $86,000) 95,000 On its Year 1 statement of cash flows, net cash used in financing activities shouldbe:
717,000
On its current year statement of cash flows, what is Big Dollars' net cash provided by operating activities
752,000
Disclosure of a related party transaction must include an evaluation of the fairness of the transactions term
False
The statement of cash flow summarizes a firms cash inflows & outflows at a specific point in time
False
WHen using the indirent method to report cash flows form operating activities, depreciation expense is subtracted from net income to arrive at net cash provided by operating activities
False
When preparing the operating activities section of the statement of cash flows under the indirect method, depreciation expense is subtracted from net income.
False
Which of the following statements regarding balance sheet presentation is true
IFRS does not prescribe the ordering of liabilities within current & non-current groups
Bales company is preparing a statement of cash flow. Which of the following would be shown on the statement?
NONE
Kong Co. purchased a three-month U.S. Treasury bill. Kong's policy is to treat as cash equivalents all highly liquid investments with an original maturity of three months or less when purchased. How should this purchase be reported in Kong's statement of cash flows?
Not reported
Redemption of bonds payable is classified as financing activity on the statement of cash flows
True
The account format of the balance sheet lists assets on the left side & liabilities and stockholder equity on the right side of the statement
True
When preparing the operating activities section of the statement of cash flows under the indirect method, gains on sale of equipment are subtracted from net income.
True
When using the direct method of reporting cash flows from operating activities, increases in accounts receivable are subtracted from revenues to arrive at cash receipts from customers.
True
Details about the composition of intangible assets are located in the summary of significant accounting policies
false
The FASB prefers the indirect method of preparing the operating activities section of the statement of cash flows.
false
The management discussion & analysis section of the annual report is a part of the audited financial statements
false
All of the following activities are classified as investing activities on a statement of cash flows except ________.
gain on sale of securities
When preparing the operating section of the statement of cash flows using the indirect method, which of the following items are added to net income?
loss on sale of equipment
If subsequent event relates to a condition that existed at the balance sheet date, then teh financial statement should be adjusted
true
The balance shet reflects the financial position of an entity over a period of time
true
If there is concern that a company might not continue in existence, but the auditor has concluded that the financial statements are fairly presented, the opinion that will be issued is a(n) ________.
unqualified opinion with explanatory paragraph
