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Exam 14: Statement of Cash Flows

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Question 81

True/False

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The declaration and issuance of a stock dividend would be reported on the statement of cash flows.

A) True
B) False

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Question 82

Multiple Choice

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Which of the following would not be on the statement of cash flows?

A) cash flows from investing activities
B) cash flows from financing activities
C) cash flows from operating activities
D) cash flows from contingent activities

E) C) and D)
F) B) and C)

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Question 83

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Land costing $71,000 was sold for $50,000 cash.The loss on the sale was reported on the income statement as other expense.On the statement of cash flows,what amount should be reported as an investing activity from the sale of land?

The statement of cash flows reports a firm's major sources of cash receipts and major uses of cash for a period of time.

Balances of the current asset and current liability accounts at the end and beginning of the year are as follows: $\begin{array}{lr}&\underline { \text { End}}&\underline { \text { Beginning }}\\ \text { Cash } & \$ 67,000 &\$ 73,000 \\\text { Accounts receivable net } & 73,000 &60,000 \\\text { Inventories } & 54,000&47,000 \\\text { Accounts payable } \\\text { merchandise creditors } & 43,000 &37,000 \\\text { Salaries payable } & 2,800 &3,800 \\\text { Sales on account } & 210,000 \\\text { Cost of merchandise sold } & 70,000\\\text { Operating expenses other than depreciation }& 67,000\end{array}$ Use the direct method to prepare the cash flows from operating activities section of a statement of cash flows.

On the statement of cash flows,the cash flows from operating activities section would include

The comparative balance sheet of Barry Company for Years 1 and 2 ended December 31 appears below in condensed form: $\begin{array}{lrr}&\underline {\text { Year 2 }}&\underline {\text { Year 1 }}\\\text { Cash } & \$ 72,000 & \$ 42,500 \\\text { Accounts receivable net } & 61,000 & 70,200 \\\text { Inventories } & 121,000 & 105,000 \\\text { Investments } & - & 100,000 \\\text { Equipment } & 515,000 & 425,000 \\\text { Accumulated depreciation -equipment } & 153,000 & 175,000\\\\&\underline{ \$ 616,000 }&\underline{ \$ 567,700 }\\\\\\\text { Accounts payable } & \$ 59,750 & \$ 47,250 \\\text { Bonds payable } & - & 75,000 \\\text { Common stock, } \$ 20 \text { par } & 375,000 & 325,000 \\\text { Premium on common stock } & 50,000 & 25,000 \\\text { Retained earnings } &\underline{ \$ 131,250 }& \underline{95,450} \\&\underline{ \$ 616,000 }&\underline{ \$ 567,700 }\\\text { Addlitional data for the current vear are as follows:}\end{array}$ a Net income,$75,800. b Depreciation reported on income statement,$38,000. c Fully depreciated equipment costing $60,000 was scrapped,no salvage,and equipment was purchased for $150,000. d Bonds payable for $75,000 were retired by payment at their face amount. e 2,500 shares of common stock were issued at $30 for cash. f Cash dividends declared and paid,$40,000. g Investments of $100,000 were sold for $125,000. Prepare a statement of cash flows using the indirect method.

On the statement of cash flows,a $7,500 gain on the sale of fixed assets would be

Land costing $140,000 was sold for $173,000 cash.The gain on the sale was reported on the income statement as other income.On the statement of cash flows,what amount should be reported as an investing activity from the sale of land?

Cash dividends of $45,000 were declared during the year.Cash dividends payable were $10,000 at the beginning of the year and $15,000 at the end of the year.The amount of cash for the payment of dividends during the year is

Which of the following would not be classified as an operating activity?

Accounts receivable from sales to customers amounted to $40,000 and $32,000 at the beginning and end of the year,respectively.Income reported on the income statement for the year was $110,000.Exclusive of the effect of other adjustments,the net cash flows from operating activities to be reported on the statement of cash flows using the indirect method is

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

Which of the following does not represent an outflow of cash and therefore would not be reported on the statement of cash flows as a use of cash?

In determining the cash flows from operating activities for the statement of cash flows by the indirect method,the depreciation expense for the period is added to the net income for the period.

Which of the following is a noncash investing and financing activity?