Chapter 12 Homework

preferred stock issued in exchange for land would be reported in the statement of cash flows in

a separate schedule or note to the financial statements

which is not generally used in preparing a statement of cash flows? current income statement comparative balance sheets adjusted trial balance additional information

adjusted trial balance

the category that is generally considered to be the best measure of a company's ability to continue as a going concern

cash flows from operating activities

issued bonds for $210,000 cash

cash inflow from financing activity

sold land costing $21,000 for $21,000 cash

cash inflow from investing activity

in calculating cash flows from operating activities using the indirect method, a gain on the sale of equipment is

deducted from net income

Starting with net income and adjusting it for items that affected reported net income but which did not affect cash is called the

indirect method

Purchase of equipment

investing activity

Sold a long-term investment with a cost of $15,000 for $15,000 cash.

investing activity

purchase of land

investing activity

sale of building

investing activity

sale of building at book value

investing activity

summarizes the operating, financing, and investing activities of an entity

statement of cash flows

declared and paid a $52,500 cash dividend

cash outflow from financing activity

purchased equipment for $189,000 cash

cash outflow from investing activity

which is an activity that would be classified as an investing activity? a. cash paid to reacquire capital stock b. cash received from dividend revenue c. cash received from interest revenue d. cash paid (loaned) to a borrower as a loan

cash paid (loaned) to a borrower as a loan

on the statement of cash flows, the cash flows from operating activities section would be affected by

cash receipts from sales activities

assume ecuyer company uses the indirect method to depict cash flows. Indicate where, if at all, stock issued for equipment would be classified on the statement of cash flows.

does not represent a cash flow

Issued $50,000 par value common stock for cash

financing activities

Assume that the Kaenzig Corporation uses the indirect method to depict cash flows. Indicate where, if at all, common stock issued for cash would be classified.

financing activities section

Assume that the Safferstein Corporation uses the indirect method to depict cash flows. Indicate where, if at all, long-term debt retired with cash would be reported on the statement of cash flows.

financing activities section

Assume that the Zahler Corporation uses the indirect method to depict cash flows. Indicate where, if at all, treasury stock purchased with cash would be classified on the statement of cash flows.

financing activities section

Declared and paid a cash dividend of $13,000

financing activity

issuance of capital stock

financing activity

payment of dividends

financing activity

redemption of bonds

financing activity

retirement of bonds

financing activity

the payment of a cash dividend is classified as

financing activity

cash flows from operating activities, as reported on the statement of cash flows under the indirect method, would include

net income

Issued $200,000 par value common stock upon conversion of bonds having a face value of $200,000

noncash investing and financing activities

Purchased a machine for $30,000, giving a long-term note in exchange.

noncash investing and financing activities

conversion of bonds into common stock

noncash investing and financing activities

exchange of land for patent

noncash investing and financing activities

issuance of bonds for land

noncash investing and financing activities

the acquisition of land by issuing common stock is a _____________ transaction that __________ reported in the body of the statement of cash flows

noncash; is not

Collected $16,000 from sale of goods

operating activities

Paid $18,000 to suppliers

operating activities

cash receipts from interest and dividends are classified as

operating activities

Assume that the Quinn Corporation uses the indirect method to depict cash flows. Indicate where, if at all, interest paid on a note would be reported on the statement of cash flows.

operating activities section

Assume that the Romanus Company uses the indirect method to depict cash flows. Indicate where, if at all, income taxes paid would be reported on the statement of cash flows.

operating activities section

assume the decker corporation uses the indirect method to depict cash flows. Indicate where, if at all, dividends received on securities held would be reported on the statement of cash flows.

operating activities section

amortization of patent

operating activity

cash received from sale of goods

operating activity

depreciation

operating activity

loss on disposal of plant assets

operating activity

The order of presentation of activities on the statement of cash flows is

operating, investing, and financing

if a company has both an inflow and outflow of cash related to property, plant, and equipment, that cash inflow and cash outflow must be ___________ in the investing activities section

reported separately

primary purpose of statement of cash flows

to provide information about a company's cash receipts and cash payments during a period

significant noncash transactions would not include a. asset acquisition through bond issuance b. treasury stock acquisition c. conversion of bonds into common stock d. exchange of plant assets

treasury stock acquisition