Reference no: EM132777107
Problem 1: Information that is material means that an error or alternative method of handling a transaction
a. could increase the profitability of a company.
b. would not affect the decisions of users.
c. would possibly affect the judgment of someone relying on the financial statements.
d. might cause a company to understate its earnings for the accounting period.
Marvel Shoes
Marvel Shoes reported the following items on its statement of cash flows for the current year:
Net cash inflows from operating activities $ 70,000
Net cash outflows from investing activities (20,000)
Net cash outflows from financing activities (40,000)
Cash balance at the beginning of the year 30,000
Problem 2: Read the information about Marvel Shoes. What was the amount of net increase or decrease in the cash balance for Marvel Shoes for the current year?
a. $70,000 increase
b. $40,000 increase
c. $30,000 increase
d. $10,000 increase