FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 13: Statement of Cash Flows

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 21

Multiple Choice

Review LaterAdd Note

Review Later

The financial statements of Garver, Inc., provide the following information for the current year: $\begin{array} { | l | l | l | } \hline & \text { Dec. 31 } & \text { Jan. 1 } \\\hline \text { Accounts receivable } & \$ 70,000 & \$ 80,000 \\\hline \text { Inventory } & \$ 110,000 & \$ 102,000 \\\hline \text { Prepaid expenses } & \$ 24,000 & \$ 28,000 \\\hline \text { Accounts payable (for merchandise) } & \$ 66,000 & \$ 64,000 \\\hline \text { Accrued expenses payable } & \$ 30,000 & \$ 40,000 \\\hline \text { Net sales } & \$ 520,000 & \\\hline \text { Cost of goods sold } & \$ 260,000 & \\\hline \begin{array} { l } \text { Operating expenses (including depreciation of } \\\$ 36,000 ) \end{array} & \$ 160,000 & \\\hline\end{array}$ -Compute the cash payments for operating expenses.

A) $146,000.
B) $118,000.
C) $162,000.
D) $130,000.

Correct Answer

verified

Show Answer

Question 22

Essay

Review LaterAdd Note

Review Later

Using the following information, complete the statement of cash flows for Nutritional Foods for the year ended December 31, 2010. Place parentheses around those figures in the statement representing cash outlays. $\begin{array}{lll}\text {Payments for purchase of land }&\$416,000\\\text {Proceeds from sale of land. }&\$58,000\\\text { Proceeds from issuance of capital stock }&\$347,000\\\text {Proceeds from issuance of bonds payable }&\$99,000\\\text { Payments to settle short-term debt. }&\$74,000\\\text { Interest and dividends received. }&\$49,000\\\text { Cash received from customers}&\$1,502,000\\\text {Dividends paid }&\$182,000\\\text {Cash paid to suppliers and employees }&\$1,172,000\\\text {Interest paid }&\$66,000\\\text {Income taxes paid }&\$115,500\\\text { Cash and cash equivalents, January 1, 2010 }&\$86,000\\\text { Cash and cash equivalents, December 31, 2010. }&?\\\end{array}$

Correct Answer

verified

Show Answer

Question 23

True/False

Review LaterAdd Note

The indirect method of computing cash flows from operations begins with net income.

The statement of cash flows is designed to assist users in assessing each of the following, except:

For a company to survive in the long-run it must have positive cash flows from investing activities.

The "bottom line" in a statement of cash flows shows:

At the beginning of 2009, Baldwin Corporation bought an automobile for $36,000 by issuing a note payable. The automobile has a six-year life and is depreciated using the straight-line method. To determine net cash flow from operating activities for 2009 using the indirect method, net income should be:

The statement of cash flows of Bosley Corporation shows the amount of cash received from customers as $720,000. If net sales in Bosley Corporation's income statement are reported at $670,000 then:

During 2009, the cash flows related to Global Data, Inc.'s lending and borrowing activities are summarized as follows: $\begin{array} { l r } \text { Cash lent to borrowers } & \$ 132,600 \\\text { Payment to retire bonds payable } & \$ 367,500 \\\text { Proceeds from borrowing at bank (note payable) } & \$ 220,500 \\\text { Interest received from borrowers } & \$ 31,500 \\\text { Interest payments made on bonds payable } & \$ 42,000\end{array}$ -On the basis of the above information alone, what is Global Data's net cash flow from financing activities?

The financial statements of York, Inc., provide the following information for the current year: $\begin{array}{lrr}&\text { Dec. 31 } & \text { Tan. 1 } \\\text { Accounts receivable } & \$ 136,500 & \$ 120,750 \\\text { Inventory } & \$ 131,250 & \$ 126,000 \\\text { Prepaid expenses } & \$ 33,600 & \$ 31,500 \\\text { Accounts payable (for merchandise) } & \$ 118,650 & \$ 110,775 \\\text { Accrued expenses payable } & \$ 33,075 & \$ 736,225\\\text { Net sales } & \$ 1,548,750 \\\text { Cost of goods sold } & \$ 813,750 \\\text { Operating expenses (including depreciation of } \$ 47,250) & \$ 183,750\end{array}$ -Compute the amount of cash received from customers during the current year.

During 2009, the cash flows related to Global Data, Inc.'s lending and borrowing activities are summarized as follows: $\begin{array} { l r } \text { Cash lent to borrowers } & \$ 132,600 \\\text { Payment to retire bonds payable } & \$ 367,500 \\\text { Proceeds from borrowing at bank (note payable) } & \$ 220,500 \\\text { Interest received from borrowers } & \$ 31,500 \\\text { Interest payments made on bonds payable } & \$ 42,000\end{array}$ -The comparative balance sheets of Friends, Inc. show a net increase in accounts receivable of $650 and a net decrease in inventory of $500. To determine net cash flow from operating activities under the indirect method, net income should be:

During 2009, the cash flows related to Global Data, Inc.'s lending and borrowing activities are summarized as follows: $\begin{array} { l r } \text { Cash lent to borrowers } & \$ 132,600 \\\text { Payment to retire bonds payable } & \$ 367,500 \\\text { Proceeds from borrowing at bank (note payable) } & \$ 220,500 \\\text { Interest received from borrowers } & \$ 31,500 \\\text { Interest payments made on bonds payable } & \$ 42,000\end{array}$ -The comparative balance sheets of Apollo Rocket, Inc. show a net increase in inventory of $79,000 and a net decrease in accounts payable of $42,000 during 2009. In computing net cash flow from operating activities under the indirect method, net income for 2009 should be:

In order to prepare the statement of cash flows for Rag Dolls Corporation for 2010, the accountant has compiled the following data regarding cash flows: $\begin{array}{lll}\text {Cash paid to acquire marketable securities }&\$370,000\\\text {Proceeds from sale of marketable securities }&17,500\\\text { Proceeds from issuance of capital stock }&280,000\\\text { Proceeds from issuance of bonds payable }&55,000\\\text {Payments to settle short-term debt }&32,500\\\text {Interest and dividends received }&10,000\\\text {Cash received from customers }&?\\\text {Dividends paid }&130,000\\\text {Cash paid to suppliers and employees }&1,030,000\\\text {Interest paid }&25,000\\\text {Income taxes paid }&70,000\\\text {Cash and cash equivalents, January 1, 2010 }&43,000\\\text {Cash and cash equivalents, December 31,2010 }&58,000\\\end{array}$ -In the 2010 statement of cash flows for Rag Dolls Corporation, the amount of cash received from customers is:

An analysis of Kenny Corporation's Investment in Marketable Securities account during 2010 disclosed the following: Kenny's 2010 income statement included a $90,000 loss on sale of marketable securities and $65,000 dividend income from marketable securities. All payments and proceeds relating to marketable securities transactions were in cash. $\begin{array} { | l | l | } \hline \text { Debit entries } & \$ 445,000 \\\hline \text { Credit entries } & \$ 270,000 \\\hline\end{array}$ -The amount of cash paid by Kenny Corporation in 2010 for the purchase of marketable securities was:

New World's net cash flow from operating activities for the current year is:

During 2009, the cash flows related to Global Data, Inc.'s lending and borrowing activities are summarized as follows: $\begin{array} { l r } \text { Cash lent to borrowers } & \$ 132,600 \\\text { Payment to retire bonds payable } & \$ 367,500 \\\text { Proceeds from borrowing at bank (note payable) } & \$ 220,500 \\\text { Interest received from borrowers } & \$ 31,500 \\\text { Interest payments made on bonds payable } & \$ 42,000\end{array}$ -Rent expense in Burr Company's income statement is $480,000. If Prepaid Rent was $120,000 on January 1 and is $95,000 on December 31, the cash paid for rent during the year is:

From the viewpoint of stockholders or potential investors, which of the following cash flow measurements would be of least importance?

When using the indirect method, depreciation expense:

An analysis of Kenny Corporation's Investment in Marketable Securities account during 2010 disclosed the following: Kenny's 2010 income statement included a $90,000 loss on sale of marketable securities and $65,000 dividend income from marketable securities. All payments and proceeds relating to marketable securities transactions were in cash. $\begin{array} { | l | l | } \hline \text { Debit entries } & \$ 445,000 \\\hline \text { Credit entries } & \$ 270,000 \\\hline\end{array}$ -How should the transactions involving marketable securities be classified in Kenny's statement of cash flows for 2010?

The financial statements of York, Inc., provide the following information for the current year: $\begin{array}{lrr}&\text { Dec. 31 } & \text { Tan. 1 } \\\text { Accounts receivable } & \$ 136,500 & \$ 120,750 \\\text { Inventory } & \$ 131,250 & \$ 126,000 \\\text { Prepaid expenses } & \$ 33,600 & \$ 31,500 \\\text { Accounts payable (for merchandise) } & \$ 118,650 & \$ 110,775 \\\text { Accrued expenses payable } & \$ 33,075 & \$ 736,225\\\text { Net sales } & \$ 1,548,750 \\\text { Cost of goods sold } & \$ 813,750 \\\text { Operating expenses (including depreciation of } \$ 47,250) & \$ 183,750\end{array}$ -Compute the amount of cash payments for purchases of merchandise during the current year.