Reference no: EM132315734

Question

1) Which of the following transactions would be shown in the? non-cash investing and financing activities section of the statement of cash? flows?

A. purchased land for? $30,000 cash

B. settled a? long-term note payable by issuing common stock

C. issued? 20,000 shares of stock at? $4 per share

D. old equipment with book value of? $6,500 in exchange for? $6,500 cash

2) Gilmore Company uses the direct method to prepare its statement of cash flows. Refer to the following financial statement information for the year ended December? 31, 2018:

Gilmore Company, Comparative Balance Sheet (attcahed below)

Use the direct? method, to compute the net cash provided by operating activities.? (Accrued Liabilities relate to other operating? expense.)

A.($38,200)

B.$54,200

C.$38,200

D.?($54,200)

3) Wesley, Inc. uses the indirect method to prepare the statement of cash flows. Refer to the following section of the comparative balance? sheet:

?Wesley, Inc. Comparative Balance Sheet (attached below)

The change in Merchandise Inventory is shown as a negative cash flow in the adjustments to net income.

True or False

4) Wisconsin Farm Equipment Company sold equipment for cash. The income statement shows a loss on the sale of? $7,000. The net book value of the asset was? $28,900. Which of the following statements describes the cash effect of the?transaction?

A.negative cash flow of? $21,900 for financing activities

B.positive cash flow of? $35,900 from financing activities

C.negative cash flow of? $21,900 for operating activities

D.positive cash flow of? $21,900 from investing activities

5) The cash paid for the purchase of equipment will typically be shown in the investing activities section of the statement of cash flows.

True

False

6) Lightning Electric Company uses the direct method to prepare its statement of cash flows. Lightning has reported operating expenses of? $63,000 on its income statement for the year 2019.

If the balance in accrued liabilities has increased by? $6,000 during the? year, then? $6,000 needs to be added to? $63,000 to calculate payments to suppliers for operating expenses. Accrued liabilities relate to operating expenses.

True

False

7) Specialty Auto Parts Company uses the indirect method to prepare its statement of cash flows. Refer to the following information for? 2018:

Net cash provided by operating? activities: $109,000

Net cash used for investing? activities: ($114,500)

Net cash provided by financing? activities: $16,000

If the cash balance at the beginning of the year was? $13,200, what is the ending cash? balance?

A.?$5,500

B.?$23,700

C.$13,200

D.?$10,500

8) Which of the following sections from the statement of cash flows includes the cash paid for the purchase of Treasury?Stock?

A.the operating activities section

B.the investing activities section

C.the financing activities section

D.the? non-cash investing and financing section

8) The statement of cash flows is dated the same as the balance sheet.

True

False

10) Wellington, Inc. uses the direct method to prepare its statement of cash flows. Refer to the following financial statement information for the year ended December? 31, 2019:

?Wellington, Inc.  Comparative Balance Sheet (attached below)

Use the direct method to compute the total cash receipts from operating activities.

A.$296,800

B.$293,800

C.$289,800

D.$ 261,800

11) To complete the statement of cash? flows, the net change in cash and its effects on the beginning cash balance must be shown.

True

False

Attachment:- Balance Sheet- Question.rar