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Exam 16: Statement of Cash Flows

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Question 31

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When using the spreadsheet (work sheet)method to analyzing noncash accounts,no order of analysis is required,but it is more efficient to start with Retained Earnings and proceed upward in the account listing.

A) True
B) False

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Question 32

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Balances of the current asset and current liability accounts at the end and beginning of the year are as follows:​ Use the direct method to prepare the Cash flows from operating activities section of a statement of cash flows.

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Question 33

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If 800 shares of $40 par common stock are sold for $43,000,the $43,000 would be reported in the Cash flows from financing activities section of the statement of cash flows.

The comparative balance sheets of Barry Company,for Years 1 and 2 ended December 31,appear below in condensed form.​ Additional data for the current year are as follows:​ Prepare a statement of cash flows using the indirect method.​

Rogers Company reported net income of $35,000 for the year.During the year,accounts receivable increased by $7,000,accounts payable decreased by $3,000,and depreciation expense of $8,000 was recorded.Net cash provided by operating activities under the indirect method for the year is

For each of the following,identify whether it would be disclosed as an operating (O),financing (F),or investing (I)activity on the statement of cash flows under the indirect method. a.Purchased buildings b.Sold patents c.Net income d.Issued common stock e.Paid cash dividendsf. Depreciation expense

The following two scenarios are independent of one another.

When using the spreadsheet (work sheet) for the statement of cash flows,under the indirect method,entries made on the spreadsheet are​

Under the indirect method,expenses that do not affect cash are added to net income in the operating activities section of the statement of cash flows.

Dorman Company reported the following data:​​ Prepare the Cash flows from operating activities section of the statement of cash flows using the indirect method.

Cash paid for preferred stock dividends should be shown on the statement of cash flows under

Under the direct method of preparing a statement of cash flows,the gain on the sale of land is not adjusted or reported as part of cash flows from operating activities.

The statement of cash flows is an optional financial statement.

For each of the following activities that may take place during the accounting period, indicate the effect (a-g) on the statement of cash flows prepared using the indirect method. Choices may be selected as the answer for more than one question. -Acquisition of treasury stock

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

Cash outflows from financing activities include the payment of cash dividends,the acquisition of treasury stock,and the repayment of amounts borrowed.

If land costing $145,000 was sold for $205,000,the $60,000 gain on the sale would be added to net income in the operating activities section of the statement of cash flows (prepared by the indirect method).

The current period statement of cash flows includes the following:​ The cash balance at the end of the period is

Free cash flow is cash flow from operations less cash used for

Samuel Company's accumulated depreciation-equipment account increased by $6,000,while patents decreased by $2,200 between balance sheet dates.There were no purchases or sales of depreciable or intangible assets during the year.In addition,the income statement showed a loss of $3,200 from the sale of investments.Assume no changes in noncash current assets and liabilities.​Samuel Company reported a net income of $92,000.Determine net cash flow from operating activities using the indirect method.