activities include those transactions and events that determine net income.
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net cash inflow
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A(n) _______ occurs when the receipts in a category exceed the payments.
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Investing
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_______ activities include those transactions and events that affect long-term assets, such as lending and collecting money for notes receivable and cash receipts from sale of long-term plant assets.
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outflow,
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Lakeview, Inc.'s statement of cash flows reports financing activities with payments that exceed receipts. This means that Lakeview had a net cash (inflow/outflow) Correct Unavailable from financing activities.
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Which of the following transactions would be reported under investing activities in the statement of cash flows? (Check all that apply.)
answer
Cash paid to purchase investments in securities
Cash paid to purchase plant assets
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What are the earnings-per-share of common stock?
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Which of the following questions could not be answered from the statement of cash flows?
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Cash dividends paid to shareholders
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Which of the following transactions would not be classified as an operating activity on the statement of cash flows?
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investing
answer
Collecting money for notes receivable would be reported on the statement of cash flows as a(n) activity.
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investing
answer
In a statement of cash flows, cash received from the sale of a building would be classified under "cash flows from activities."
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operating,
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The purchase of merchandise, the sale of goods and services to customers, and expenditures to operate the business are all reported on the statement of cash flows under operating, activities.
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Which of the following items are classified as noncash investing and financing activities? (Check all that apply.)
answer
Issuance of common stock in exchange for land
Retirement of debt by issuing stock
Purchase of a building with a note
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Information about cash flows can influence decision makers in important ways. Which of the following questions could be answered by the statement of cash flows? (Check all that apply.)
answer
Can the company pay its debts?
How does a company spend its cash?
Does the company have the resources to pursue opportunities?
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The statement of cash flows reports noncash investing and financing transactions in
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a note or separate schedule
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operating
answer
activities include those transactions and events that determine net income.
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Which of the following transactions would be reported under investing activities in the statement of cash flows? (Check all that apply.)
answer
Cash paid to purchase investments in securities
Cash paid to purchase plant assets
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Identify which of the following items is not a noncash investing and financing activity that must be reported in a note to the statement of cash flows. (Check all that apply.)
answer
Repayment of a note with cash
Purchase of a plant asset with cash
question
A company reported total assets at the end of 2017 of $95,000; including cash of $35,000, accounts receivable of $20,000, and inventory of $40,000. It reported total assets at the end of 2018 of $110,000; including cash of $44,000; accounts receivable of $29,000, and inventory of $37,000. Compute the net increase or decrease in cash in 2018.
answer
Increase of $9,000
question
Collecting money for notes receivable would be reported on the statement of cash flows as a(n
answer
investing
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Which of the following transactions would not be reported under investing activities in the statement of cash flows?
answer
Cash paid for interest on long-term notes
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Which of the following is not one of the five important steps to preparing a statement of cash flows?
answer
Compute the net income
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Carol Co. prepares a statement of cash flows starting with net income and then adjusting for items necessary to obtain net cash provided or used by operating activities. Carol Co. must be using the (direct/indirect) method of reporting the statement of cash flows.
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indirect
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At the beginning of 2018, Rex Co. showed a debit balance in the cash account of $20,500. Total debits to this account during the year were $45,000, and total credits during the year were $35,000. The net (increase/decrease) in cash for 2018 equals $.
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increase 10,000
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The indirect method of computing and reporting net cash flows from operating activities involves adjusting to obtain the net cash provided or used by operating activities.
answer
net income
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A loss from the sale of an investment would be (added/subtracted) to (from) net income when computing cash flows from operations, using the indirect method.
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added
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Which of the following would be included in the operating section when preparing the statement of cash flows using the indirect method?
answer
Net income
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Which of the following items would not be adjusted to net income when computing cash flows from operating activities, using the indirect method?
answer
Cash received from sale of building
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A gain from the sale of a building would be (added/subtracted) to (from) net income when computing cash flows from operations, using the indirect method.
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subtracted)
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Accounts receivable had a debit balance of $4,000 at the beginning of the period, and a debit balance of $6,000 at the end of the period. Based on this information, the adjustment to net income for the period will be reported as:
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an increase of $2,000 which will be subtracted from net income
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In preparing a cash flows from operating activities using the indirect method, an increase in accounts receivable would be (added/subtracted) to (from) net income.
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subtracted
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Inventory at the beginning of the period had a debit balance of $7,000, and a debit balance of $10,000 at the end of the period. Using the indirect method, this will be reported in the operating section of the statement of cash flows as:
answer
an increase of $3,000 which will be subtracted from net income
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Accounts receivable had a debit balance of $10,000 at the beginning of the period, and a debit balance of $6,000 at the end of the period. Based on this information, the adjustment to net income for the period will be reported as:
answer
a decrease of $4,000 which will be subtracted from net income
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Inventory at the beginning of the period had a debit balance of $9,000, and a debit balance of $7,000 at the end of the period. Using the indirect method, this will be reported in the operating section of the statement of cash flows as:
answer
a decrease of $2,000 which will be added to net income
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Reid Company's balance in prepaid insurance at the beginning and end of the year was $1,000 and $1,200, respectively. This will be reported on the statement of cash flows using the indirect method as:
answer
an increase of $200 which will be subtracted from net income
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Which of the following items would not be adjusted to net income when computing cash flows from operating activities, using the indirect method?
answer
Cash received from sale of building
question
Blue Co. sold plant assets costing $15,000 with accumulated depreciation of $10,000 for $7,000. As a result, Blue Co will report _____ on the statement of cash flows in the cash flows from investing activities section.
answer
an increase of $7,000 in the investing activities section
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An increase in wages payable would be (added/subtracted) to (from) net income when preparing cash flows from operating activities, using the indirect method.
answer
added
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Accounts receivable had a debit balance of $4,000 at the beginning of the period, and a debit balance of $6,000 at the end of the period. Based on this information, the adjustment to net income for the period will be reported as:
answer
an increase of $2,000 which will be subtracted from net income
question
Sheldon Company's balance in prepaid insurance at the beginning and end of the year was $2,500 and $1,000, respectively. This will be reported on the statement of cash flows using the indirect method as:
answer
a decrease of $1,500 which will be added to net income
question
Cash flows from financing activities identifies cash receipts and cash payments related to which of the following types of accounts? (Check all that apply.)
answer
Common Stock
Bonds Payable
question
Which of the following items would be subtracted from net income when reporting cash flows from operating activities, using the indirect method? (Check all that apply.)
answer
Decrease in taxes payableDecrease in wages payable
question
Accountants can use a three-step process to determine cash provided (or used) by investing activities. Which of the following steps is not part of this process?
answer
Identify adjustments to net income.
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At the beginning of the period, a company reported $100,000 of common stock, $10 par; and $50,000 paid-in capital in excess of par. At the end of the period, this company reported $110,000 of common stock, $10 par; and $90,000 paid-in capital in excess of par. Cash received from the sale of common stock during the year is $
answer
50000
question
Net cash provided by operating activities was $12,000. Net cash provided by investing activities was $2,000. Net cash used in financing activities was $7,000. The cash balance at the beginning of the year was $4,000. The cash balance at the end of the year is:
answer
$11,000
question
The three-step analysis to determine cash provided or used by financing activities includes:
answer
reporting the cash flow effects
identifying changes in financing-related accounts
explaining the changes using T-accounts and reconstructed entries
question
Net cash used in operating activities was $10,000. Net cash provided by investing activities was $2,000. Net cash provided by financing activities was $5,000. The cash balance at the end of the year was $12,000. The cash balance at the beginning of the year was $
answer
15000
question
A company repaid a long-term debt during the year. They will report this as an (increase/decrease)
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decease, financing
question
At the beginning of the period, a company reported $100,000 of common stock, $10 par; and $50,000 paid-in capital in excess of par. At the end of the period, this company reported $110,000 of common stock, $10 par; and $90,000 paid-in capital in excess of par. Cash received from the sale of common stock during the year is $
answer
50000
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It is important to analyze the sources and uses of cash because (select all that apply):
answer
Creditors use this information to assist them in deciding whether to loan funds to them.
Investors use this information to decide if they will purchase their stock.
question
Investors assess cash flows before
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buying and selling stock
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