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Exam 12: Reporting Cash Flows

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Question 51

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Explain the purpose and format of the statement of cash flows.Also describe its relevance to decision makers.

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The purpose of the statement of cash flo...

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Question 52

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The use of a spreadsheet for analysis is especially useful when preparing the statement of cash flows using the ________ method.

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Question 53

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When preparing the operating activities section of the statement of cash flows using the indirect method,decreases in current assets are subtracted from net income.

Financing activities include receiving cash dividends from investments in equity securities.

The cash flow on total assets ratio is computed by dividing cash flows from operations by average total assets.

The purchase of long-term assets by issuing a note payable for the entire amount is reported on the statement of cash flows in the:

Probably the most important section of the statement of cash flows in analyzing the financial performance of a company's ongoing business is the ________ section.

A machine with a cost of $130,000 and accumulated depreciation of $85,000 is sold for $50,000 cash.The amount that should be reported as a source of cash under cash flows from investing activities is:

Explain how the cash flows from operating activities section of the statement of cash flows is prepared using the direct method.

In preparing a company's statement of cash flows using the indirect method,the following information is available: -Net cash provided by operating activities was:

A purchase of land in exchange for shares of stock is disclosed at the bottom of the statement of cash flows or in a note to the statement.

The indirect method for computing and reporting net cash flows from operating activities involves adjusting the net income figure to obtain net cash provided or used by operating activities.

All of the following statements related to preparation of the statement of cash flows are true except:

The direct method for computing and reporting net cash flows from operating activities involves adjusting the net income figure to obtain net cash provided or used by operating activities.

Explain the use of a spreadsheet in the preparation of the statement of cash flows.

Transactions with a company's owners and creditors that include obtaining cash from issuing debt and repaying the amounts borrowed,and distributing cash to owners.

For each of the following separate cases,use the information provided to calculate the missing cash inflow or cash outflow using the direct method.

A statement of cash flows explains the differences between the beginning and ending balances of:

A company's Inventory balance at the end of the year was $188,000 and $200,000 at the beginning of the year.Its Accounts Payable balance at the end of the year was $84,000 and $80,000 at the beginning of the year,and its cost of goods sold for the year was $720,000.The company's total amount of cash payments for merchandise during the year equals:

The accountant for Sysco Company is preparing the company's statement of cash flows for the fiscal year just ended.The following information is available: What is the amount of cash dividends paid that should be reported in the financing section of the statement of cash flows?