Question 1

An example of an investing activity is

Accepted Answer

A)   the issue of preferred stock.
B)   the resale of treasury stock.
C)   the issue of bonds and notes payable.
D)   the purchase of property, plant, or equipment for cash.E) A) and B)
F) A) and C)

Question 2

Cash and cash equivalents, as used on the statement of cash flows, consist of

Accepted Answer

A)   only currency and bank accounts.
B)   only bank accounts.
C)   currency, bank accounts, and all investments.
D)   currency, bank accounts and short-term, highly liquid investments.E) None of the above
F) All of the above

Question 3

Cannon Manufacturing Co. sold equipment that cost $18,000 for $6,000. A loss on sale of $1,000 was recorded. How is the Cash Flows from Operating Activities affected?

Accepted Answer

A)   The loss of $1,000 is added to Net Income.
B)   The loss of $6,000 is added to Net Income.
C)   The gain of $6,000 is deducted from Net Income.
D)   The loss of $1,000 is deducted from Net Income.E) A) and D)
F) A) and B)

Question 4

The payment of interest is considered to be

Accepted Answer

A)   an outflow of cash that results from a financing activity.
B)   an outflow of cash that results from an investing activity.
C)   an outflow of cash that results from an operating activity.
D)   an activity that is not reported on the statement of cash flows.E) A) and B)
F) A) and C)

Question 5

Decreases in current assets must be deducted from net income to arrive at cash flows from operations.

Accepted Answer

A) True 
 B)False

Question 6

An increase in accounts payable is

Accepted Answer

A)   added to the net income when determining the net cash provided by operating activities.
B)   subtracted from the net income when determining the net cash provided by operating activities.
C)   added to the cash flows from investing activities.
D)   not used to calculate the net cash provided by operating activities.E) B) and C)
F) A) and D)

Question 7

The cash received from issuing common stock would not be reported on the statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 8

Net income must be adjusted for changes in ____________________ assets and liabilities, such as accounts receivable and accounts payable, when determining the net cash provided by operating activities.

Accepted Answer

The answer of Net income must be adjusted for changes...

Question 9

Interest expense is treated as an outflow of cash that results from a(n) ____________________ activity.

Accepted Answer

The answer of Interest expense is treated as an outflow...

Question 10

On the statement of cash flows, cash and cash ____________________ consist of currency, bank accounts, and short-term, highly liquid investments.

Accepted Answer

The answer of On the statement of cash flows, cash...

Exam 24: The Statement of Cash Flows

Decreases in current assets must be deducted from net income to arrive at cash flows from operations.

Correct Answer
verified

An example of an investing activity is

Correct Answer
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The payment of interest is considered to be

Correct Answer
verified

Interest expense is treated as an outflow of cash that results from a(n) ____________________ activity.

Correct Answer
verified

On the statement of cash flows, cash and cash ____________________ consist of currency, bank accounts, and short-term, highly liquid investments.

Correct Answer
verified

Cash and cash equivalents, as used on the statement of cash flows, consist of

Correct Answer
verified

The cash received from issuing common stock would not be reported on the statement of cash flows.

Correct Answer
verified

Cannon Manufacturing Co. sold equipment that cost $18,000 for $6,000. A loss on sale of $1,000 was recorded. How is the Cash Flows from Operating Activities affected?

Correct Answer
verified

An increase in accounts payable is

Correct Answer
verified

Net income must be adjusted for changes in ____________________ assets and liabilities, such as accounts receivable and accounts payable, when determining the net cash provided by operating activities.

Correct Answer
verified

Exam 24: The Statement of Cash Flows

Decreases in current assets must be deducted from net income to arrive at cash flows from operations.

Correct AnswerverifiedShow Answer

An example of an investing activity is

Correct AnswerverifiedShow Answer

The payment of interest is considered to be

Correct AnswerverifiedShow Answer

Interest expense is treated as an outflow of cash that results from a(n) ____________________ activity.

Correct AnswerverifiedShow Answer

On the statement of cash flows, cash and cash ____________________ consist of currency, bank accounts, and short-term, highly liquid investments.

Correct AnswerverifiedShow Answer

Cash and cash equivalents, as used on the statement of cash flows, consist of

Correct AnswerverifiedShow Answer

The cash received from issuing common stock would not be reported on the statement of cash flows.

Correct AnswerverifiedShow Answer

Cannon Manufacturing Co. sold equipment that cost $18,000 for $6,000. A loss on sale of $1,000 was recorded. How is the Cash Flows from Operating Activities affected?

Correct AnswerverifiedShow Answer

An increase in accounts payable is

Correct AnswerverifiedShow Answer

Net income must be adjusted for changes in ____________________ assets and liabilities, such as accounts receivable and accounts payable, when determining the net cash provided by operating activities.

Correct AnswerverifiedShow Answer

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