Accounting Quiz #3 Answers

If a company reports a net loss, it: (a) will not be able to make capital expenditures (b) will not be able to get a loan (c) will not be able to pay cash dividends (d) may still have a net increase in cash

Using the indirect method, which of the following adjustments to convert net income to net cash provided by operating activities is correct?

The net income reported on the income statement for the current year was $1,260,000. Depreciation recorded on plant assets was $257,000. Accounts receivable and inventories increased by $72,000 and $48,000, respectively. Prepaid expenses and accounts payable decreased by $6,000 and $66,000, respectively. How much cash was provided by operating activities?

The indirect and direct methods of preparing the statement of cash flows are identical EXCEPT for the

When equipment is sold for cash, the amount is reflected as a

If a loss of $27,000 is incurred in selling (for cash) office equipment having a book value of $200,000, the total amount reported in the cash flows from investing activities section of the statement of cash flows is

Which of the following would not appear in the operating section of the statement of cash flows prepared under the direct method? (a) cash received from customers (b) cash paid for income taxes (c) gain on sale of equipment (d) cash paid to employees

Which of the following items appears in the operating section of the statement of cash flows under the indirect method? (a) cash payments to suppliers (b) cash collected from customers (c) loss on sale of equipment (d) all of the above

The cost of goods sold during the year was $330,000. The inventory increased by $12,000 during the year and accounts payable decreased by $19,000 during the year. Using the direct method of reporting cash flows from operating activities, cash payments to suppliers total