Statement of cash flows prepared by the indirect technique

Assignment Help Financial Accounting

Reference no: EM133577

Question :

1) In a statement of cash flows, increases or decreases in noncurrent assets are most closely related with

a. operating activities

b. investing activities

c. financing activities.

d. investing or financing activities

2) In a statement of cash flows, which of the subsequent events would be classified as a financing activity?

a. purchase of a trading security

b. payment of interest on a loan

c. payment of cash dividends to stockholders

d. all of these

3) Which of the subsequent events would be classified as an investing activity on a statement of cash flows?

a. payment of interest on a loan

b. receipt of cash dividends on an available-for-sale investment

c. purchase of treasury stock

d. sale of an office building at a gain

4) In a statement of cash flows, the payment of a cash dividend on general stock outstanding could be classified as cash outflows for

a. operating activities

b. investing activities

c. lending activities

d. financing activities

5) In a statement of cash flows, which of the subsequent events would not be classified as an operating activity?

a. buy of a trading security

b. receipt of a cash dividend

c. payment of interest on a bond issue

d. proceeds from the sale, at a profit, of an available-for-sale security

6) The subsequent information relates to the Jordan, Inc:

Depreciation expense $ 500

Increase in salaries payable $ 50

Purchased operating equipment $ 700

Net income $3,000

Paid long term note payable $ 600

Paid dividends $ 900

Increase in accounts receivable $ 400

Determine the net cash provided by operating activities?

a. $2,100

b. $2,650

c. $3,200

d. $3,150

7) The subsequent information relates to the Stockton Company:

Paid note payable $ 150

Bought equipment $ 260

Depreciation expense $ 500

Net income $ 6,000

Paid dividends $ 500

Issued bonds payable $ 1,100

Issued common stock $ 900

Sold land $ 2,400

What is the total cash provided by financing activities?

a. $1,350

b. $1,850

c. $2,350

d. $5,850

8) Which of the subsequent events would not result in a cash inflow?

a. sale of preferred stock

b. general stock issued as a stock dividend

c. reissuance of treasury stock

d. loss of building destroyed by fire but partially reimbursed by insurance

9) In a statement of cash flows prepared by the indirect technique, which of the subsequent events would be deducted from net income?

a. equity-technique investment income in excess of dividends received

b. loss on the sale of an available-for-sale investment

c. proceeds from the sale of plant assets

d. amortization expense on a patent

10) In a statement of cash flows prepared by the indirect technique, which of the subsequent events would be added to net income?

a. receipt of dividends on an available-for-sale investment

b. equity-technique income from an investment in excess of dividends

c. proceeds from the sale of an available-for-sale investment

d. loss on the sale of plant assets

Reference no: EM133577

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