Accounting ch.13 quiz

A corporation uses the indirect method for preparing the statement of cash flows. A fixed asset has been sold for $25,000, representing a gain of $4,500. The value reported in the operating activities section regarding this event would be

$(4,500)

In determining net cash flows from operating activities using the indirect method, a gain on the sale of equipment is

deducted from net income

The acquisition of treasury stock would appear on the statement of cash flows as an

outflow of cash in the financing activities section

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 an increase of

$63,000 in the investing activities section and a deduction of $9,000 from net income in the operating activities section Gain on Sale of Building = $63,000 - $54,000 = $9,000

A company purchases equipment for $32,000 cash. This transaction should be shown on the statement of cash flows as a(n)

investing activity

The following information is available from the current period financial statements: Net income $165,000 Depreciation expense 28,000 Increase in accounts receivable 16,000 Decrease in accounts payable 21,000 ​ The net cash flows from operating activities using the indirect method is

Cash flows from (used for) operating activities: Net income $165,000 Adjustments to reconcile net income to net cash flow from (used for) operating activities: Depreciation expense 28,000 Changes in current operating assets and liabilities: Increase in accounts receivable (16,000) Decrease in accounts payable (21,000) Net cash flows from operating activities $156,000*****

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

operating, investing, and financing

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

a decrease in accounts receivable

On the statement of cash flows, the "Cash flows from (used for) financing activities" section would include

cash received from issuing common stock

Cash received from the issuance of a mortgage note payable would be classified as a(n)

financing activity