Exam 3 Cash flows

3. Which of the following would appear in the computation of net cash flow from operating activities if using the direct method? Cash received from customers Net income Increase in accounts payable Increase in supplies

Cash received from customers

Cash flows from __________ activities are the cash flows from transactions that affect the debt and equity of the company. investing operating financing purchasing

financing

4. Cash inflows from investing activities normally arise from all of the following EXCEPT selling fixed assets issuing stock selling investments selling intangible assets.

issuing stock

Cash flows from __________ activities are the cash flows from transactions that affect the net income of a company. operating investing financing purchasing

operating

Which of the following transactions would be reported in the Investing Activities section? a. Purchase of land for cash for $15,000 b. Issue of 4,000 shares of common stock for $10 per share c. Payment of cash dividends of $28,000 d. Purchase inventory of $6,000

a. Purchase of land for cash for $15,000

Under the indirect method, a. net income is the first amount reported on the statement of cash flows. b. the balance sheet accounts should be analyzed in their order of liquidity. c. the first account normally analyzed is Cash. d. a change in any balance sheet account (excluding cash) can be analyzed in terms of changes in other balance sheet accounts.

a. net income is the first amount reported on the statement of cash flows.

Russell Corporation had the following activities: Recorded depreciation of $5,000 Purchased $10,000 of equipment with cash Paid $4,000 in interest payments Received $8,000 cash for the sale of an asset What is the amount of net cash flows from (used for) investing activities? a. $2,000 b. $(2,000) c. $(11,000) d. $15,000

b. $(2,000)

What is the amount of net cash flows from (used for) financing activities? a. $25,000 b. $10,000 c. $(14,000) d. $15,000

b. $10,000

Which of the following accounts would not be analyzed to determine a company's cash flows from financing activities? a. Bonds Payable b. Accounts Payable c. Paid-In Capital in Excess of Par—Common Stock d. Dividends Payable

b. Accounts Payable

Under the indirect method, which of the following are deducted from net income? a. Decreases in accounts receivable b. Increases in inventory c. Increases in accounts payable d. Decreases in prepaid expenses

b. Increases in inventory

Under the indirect method, a loss on the sale of land is a. deducted from net income. b. added to net income. c. ignored. d. >not reported as part of net income.

b. added to net income.

Fox Corporation reported the following on its year-end statement of cash flows: Net cash flow from operating activities $120,700 Net cash flow used for investing activities (2,850) Net cash flow used for financing activities (19,000) Cash at the beginning of the year52,500 What is the amount of cash at the end of the year? a. $45,650 b. $98,150 c. $151,350

c. $151,350

What would be the correct order in which the following would be listed on a statement of cash flows? a. Cash paid for purchase of land, decrease in inventories, cash paid for dividends b. Cash paid for dividends, cash paid for purchase of land, decrease in inventories c. Decrease in inventories, cash paid for purchase of land, cash paid for dividends d. Decrease in inventories, cash paid for dividends, cash paid for purchase of land

c. Decrease in inventories, cash paid for purchase of land, cash paid for dividends