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Exam 13: Statement of Cash Flows

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Question 21

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Which one of the following items is not necessary in preparing a statement of cash flows?

A) Determine the change in cash
B) Determine the cash provided by operations
C) Determine cash from financing and investing activities
D) Determine the cash in all bank accounts

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Question 22

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In Alona Company, net income is $285,000. If accounts receivable increased $140,000 and accounts payable decreased $40,000, net cash provided by operating activities using the indirect method is:

A) $105,000.
B) $185,000.
C) $385,000.
D) $465,000.

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Question 23

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

The statement of cash flows is prepared from all of the following except

Tomas Pest Control Products has the following information available: What is Tomas' free cash flow?

Analysis of the changes in all of the noncash balance sheet accounts will explain the change in the Cash account.

In preparing a statement of cash flows, the issuance of debt should be reported separately from the retirement of debt.

The payment of interest on bonds payable is classified as a cash outflow from operating activities.

A loss on sale of equipment is added to net income in determining cash provided by operations under the indirect method.

The acquisition of a building by issuing bonds would be considered an investing and financing activity that did not affect cash.

Free cash flow equals cash provided by

Kanet Company issued common stock for proceeds of $386,000 during 2014. The company paid dividends of $80,000 and issued a long-term note payable for $95,000 in exchange for equipment during the year. The company also purchased treasury stock that had a cost of $15,000. The financing section of the statement of cash flows will report net cash inflows of

Cash receipts from interest and dividends are classified as

In Jude Company, land decreased $150,000 because of a cash sale for $150,000, the equipment account increased $60,000 as a result of a cash purchase, and Bonds Payable increased $120,000 from issuance for cash at face value. The net cash provided by investing activities is

Which of the following would not appear in the operating activities section of a statement of cash flows prepared under the direct method?

LRRP Company had credit sales of $650,000. The beginning accounts receivable balance was $15,000 and the ending accounts receivable balance was $140,000. What were the cash collections from customers during the period?

The net income reported on the income statement for the current year was $220,000. Depreciation recorded on plant assets was $35,000. Accounts receivable and inventories increased by $2,000 and $8,000, respectively. Prepaid expenses and accounts payable decreased by $2,000 and $12,000 respectively. How much cash was provided by operating activities?

All of the following statements about free cash flow are false except:

The information in a statement of cash flows will not help investors to assess the entity's ability to

For external reporting, a company must prepare either an income statement or a statement of cash flows, but not both.