Which of the
following would NOT be shown in the investing section of a cash flow statement?
a. Acquisition of equipment
b. Acquisition of a building
c. Proceeds from sale of
equipment
d. All of the above are
shown in the investing section of a cash flow statement
Treasury stock
purchased for cash would appear in which of the following sections of the cash
flow statement?
a. Operating section
b. Investing section
c. Financing section
d. It would not appear on
the statement.
During 2007, XYZ
Company experienced the following changes:
Current liabilities: $75,000 increase
Non-current liabilities: $45,000 decrease
Owners' equity: $51,000 decrease
Non-current assets: $42,000 increase
Current assets (other than Cash): $18,000 increase
Given the above data, the change in cash for 2007 was ___________.
Current liabilities: $75,000 increase
Non-current liabilities: $45,000 decrease
Owners' equity: $51,000 decrease
Non-current assets: $42,000 increase
Current assets (other than Cash): $18,000 increase
Given the above data, the change in cash for 2007 was ___________.
a. ($57,000)
b. $30,000
c. $39,000
d. ($81,000)
Which of the
following would be shown in the financing section of a cash flow statement?
a. Long-term bonds payable
issued
b. Long-term notes payable
issued
c. Short-term notes payable
issued
d. All of the above
A payment made from
accounts payable will cause cash to __________ .
a. increase
b. decrease
c. show no change
d. The effect on cash cannot
be determined based on given information.
Long-term
investments sold for cash with a recognized gain would appear in which of the
following sections of the cash flow statement?
a. Operating section
b. Investing section
c. Financing section
d. It would not appear on
the statement.
In most countries,
the preparation of a ___________ is a common practice.
a. cash flow statement
b. financing activities
statement
c. investing activities
statement
d. statement of sources and
uses of funds
Preferred stock
issued for cash would appear in which of the following sections of the cash
flow statement?
a. Operating section
b. Investing section
c. Financing section
d. It would not appear on
the statement.
When determining
cash flow from operations, which of the following would NOT be added back to
net income?
a. Loss on sale of equipment
b. Equity in affiliate's
losses
c. Amortization of bond
premium
d. All of the above
When determining
cash flow from operations, which of the following would NOT be deducted from
net income?
a. Increase in accounts
receivable
b. Loss on sale of equipment
c. Amortization of bond
premium
d. Decrease in accounts
payable
At the beginning
and end of 2007, XYZ Company reported the following balances for Bonds Payable:
Jan 1: $100,000
Dec 31: $140,000
In addition, $60,000 In bonds was retired In 2007.
Given the above data, the amount of Bonds Payable issued during the year was ___________.
Jan 1: $100,000
Dec 31: $140,000
In addition, $60,000 In bonds was retired In 2007.
Given the above data, the amount of Bonds Payable issued during the year was ___________.
a. $100,000
b. $20,000
c. $160,000
d. $180,000
When determining
cash flow from operations, which of the following would be deducted from net
income?
a. Decrease in warranties
payable
b. Increase in inventories
c. Increase in accounts
payable
d. All of the above
In determining cash
flow from operations, which of the following would be added to net income?
a. Increased accounts
receivable
b. Increased merchandise
inventory
c. Increased accounts
payable
d. Decreased notes payable
to suppliers
Issuing ten-year
bonds will cause cash to __________ .
a. increase
b. decrease
c. show no change
d. The effect on cash cannot
be determined based on given information.
Depreciation
recorded on equipment would appear in which of the following sections of the
cash flow statement?
a. Operating section
b. Investing section
c. Financing section
d. It would not appear on
the statement.
XYZ reported
balances in the Accumulated Depreciation account of $130,000 on 01/01/07 and
$120,000 on 12/31/07. During 2007, an asset costing $100,000 (with an
accumulated depreciation of $80,000) was sold for $20,000.
Given this data, the depreciation expense for 2007 was ___________.
Given this data, the depreciation expense for 2007 was ___________.
a. $10,000
b. $90,000
c. $110,000
d. $70,000
Which of the
following statements about depreciation expense is true?
a. Depreciation expense
increases the expense for a period but does not use cash.
b. When determining funds
from operations, depreciation expense that had originally been subtracted in
computing net income is added back to net income, but it is not a use of cash.
c. Depreciation expense is
not a source of funds.
d. All of the above
statements are true.
In determining cash
flow from operations, which of the following would be an add-back to net
income?
a. Gain on sale of building
b. Loss on sale of building
c. Decrease in inventories
d. All of the above
Salaries paid
during the year would appear in which of the following sections of the cash
flow statement?
a. Operating section
b. Investing section
c. Financing section
d. It would not appear on
the statement.
Which of the
following typically happens during the maturation phase of a product's life
cycle?
a. Cash outflow exceeds cash
inflow from operations.
b. Cash outflow exceeds
cash inflow from investing activities.
c. Cash inflow exceeds cash
outflow from financing activities.
d. All of the above
Preferred stock
converted into common stock would appear in which of the following sections of
the cash flow statement?
a. Operating section
b. Investing section
c. Financing section
d. It would not appear on
the statement.
Which of the
following typically happens during the growth phase of a product's life cycle?
a. Cash outflow exceeds cash
inflow from operations.
b. Cash outflow exceeds cash
inflow from investing activities.
c. Cash inflow exceeds cash
outflow from financing activities.
d. All of the above
Accruing an income
tax liability will cause cash to ___________ .
a. increase
b. decrease
c. show no change
d. The effect on cash cannot
be determined based on given information.
The most popular
method of presenting cash from operations in a cash flow statement is the
___________.
a. direct method
b. operations method
c. indirect method
d. funds method
A cash flow
statement is typically prepared ____________.
a. before the balance sheet
is prepared
b. after the balance sheet
is prepared but before the income statement is prepared
c. after the income
statement is prepared but before the balance sheet is prepared
d. after both the balance
sheet and the income statement are prepared
Which of the
following transactions would be shown on a cash flow statement, but does not
affect cash?
a. Sale of bonds for cash
b. Exchange of land for
stock
c. Collection of customer
accounts
d. Payment of dividends to
owners
Recording a
depreciation expense will cause cash to ____________ .
a. increase
b. decrease
c. show no change
d. The effect on cash cannot
be determined based on given information.
Paying cash to
retire preferred stock will cause cash to ___________ .
a. increase
b. decrease
c. show no change
d. The effect on cash cannot
be determined based on given information.
An increase in the
accounts payable balance would appear in which of the following sections of the
cash flow statement?
a. Operating section
b. Investing section
c. Financing section
d. It would not appear on
the statement
Declaring dividends
will cause cash to _____________ .
a. increase
b. decrease
c. show no change
d. The effect on cash cannot
be determined based on given information.
New equipment
purchased by issuing a long-term note payable would appear in which of the
following sections of the cash flow statement?
a. Operating section
b. Investing section
c. Financing section
d. It would not appear on
the statement.
Which of the
following typically happens during the introduction phase of a product's life
cycle?
a. Cash outflow exceeds cash
inflow from operations.
b. Cash outflow exceeds cash
inflow from investing activities.
c. Cash inflow exceeds cash
inflow from financing activities.
d. All of the above
Which of the
following typically happens during the introduction phase of a product's life
cycle?
a. Cash outflow exceeds cash
inflow from operations.
b. Cash outflow exceeds cash
inflow from investing activities.
c. Cash inflow exceeds cash
inflow from financing activities.
d. All of the above
Which of the
following statements does NOT illustrate a proper interpretation of information
in a cash flow statement?
a. Capital-intensive firms
would likely show a substantially smaller add-back to net income for
depreciation than service firms would show.
b. The product life cycle
concept provides useful insights into the relation between cash flows from
operating, investing, and financing activities.
c. The adjustments for
changes in operating working capital accounts depend in part on a firm's rate
of growth.
d. All of the above
When preparing cash
flow statements, the practice of presenting cash from operations by listing all
cash-generating revenues followed by all cash expenses is called the
___________.
a. direct method
b. operations method
c. indirect method
d. funds method
Equity in the
undistributed earnings of a recognized affiliate would appear in which of the
following sections of the cash flow statement?
a. Operating section
b. Investing section
c. Financing section
d. It would not appear on
the statement.
Unearned revenue
that had been reduced during the year would appear in which of the following
sections of the cash flow statement?
a. Operating section
b. Investing section
c. Financing section
d. It would not appear on
the statement.
An amortization of
a bond discount would be shown ____________.
a. as an add-back to net
income when determining cash flow from operations
b. as a deduction from net
income when determining cash flow from operations
c. in the financing section
d. None of the above
Which of the
following would be included in the investing section of a cash flow statement?
a. Proceeds from sale of
equipment
b. Proceeds from sale of
long-term investments
c. Proceeds from sale of
marketable securities
d. All of the above would be
included in the investing section.
The sale of
equipment for cash with a recognized loss would appear in which of the
following sections of the cash flow statement?
a. Operating section
b. Investing section
c. Financing section
d. It would not appear on
the statement.
When determining
cash flow from operations, which of the following would NOT be added back to
net income?
a. Decrease in deferred
income tax liability
b. Decrease in prepaid
insurance
c. Decrease in accounts
receivable
d. Increase in accounts
payable
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