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Exam 11: Statement of Cash Flows

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Question 1

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Laser World's income statement reported total revenues,$850,000 and total expenses (including $40,000 depreciation) of $720,000.The balance sheet reported the following: Accounts Receivable-beginning balance,$50,000 and ending balance,$60,000;Accounts Payable-beginning balance,$22,000 and ending balance,$28,000.Therefore,based only on this information,the net cash inflows from operating activities were:

A) $126,000.
B) $166,000.
C) $174,000.
D) $186,000.

E) A) and B)
F) A) and C)

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B

Question 2

Multiple Choice

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Schneider Inc.purchases its inventory from suppliers on account.During the year,its Inventory account increased by $10 million and its accounts payable to suppliers decreased by $3 million.Cost of goods sold was $440 million,its cash outflows to inventory suppliers totaled:

A) $453 million.
B) $447 million.
C) $433 million.
D) $427 million.

E) C) and D)
F) All of the above

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Question 3

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For each of the following five transactions,indicate by letter whether the cash effect of each transaction is reported in a statement of cash flows as an operating (O),investing (I),financing (F),or noncash (NC)activity.

Nathan Herrmann has completed the basic format to be used in preparing the statement of cash flows (indirect method)for CEO Consultants. Listed below in random order are line items to be included in the statement of cash flows. Prepare the statement of cash flows for CEO Consultants using the indirect method.

Use the following information to answer the next 3 questions: Bad Brad's BBQ had cash flows for the year as follows ($ in millions) : -Bad Brad's would report net cash inflows (outflows) from investing activities in the amount of:

Electronic Wonders reports net income of $95,000.The accounting records reveal Depreciation Expense of $50,000 as well as increases in Prepaid Rent,Accounts Payable,and Income Tax Payable of $40,000,$23,000,and $20,000,respectively.Prepare the operating activities section of Electronic Wonders' statement of cash flows using the indirect method.

Use the following information to answer the next 3 questions: Bad Brad's BBQ had cash flows for the year as follows ($ in millions) : -Bad Brad's would report net cash inflows (outflows) from financing activities in the amount of:

Lense Laboratories' net income was $250,000.Given the account information below,what is the net operating cash flows for Lense Laboratories?

For each of the following five transactions,indicate by letter whether the cash effect of each transaction is reported in a statement of cash flows as an operating (O),investing (I),financing (F),or noncash (NC)activity.

Which of the following is an example of a cash inflow from a financing activity?

Shively Mfg.Co.sold land costing $10,000 for $12,000.Shively would report:

The balance sheet of Computer World reports total assets of $350,000 and $450,000 at the beginning and end of the year,respectively.Sales revenues are $800,000,net income is $100,000,and net cash flows from operating activities are $150,000.What is Computer World's asset turnover?

Innovative Products reported net income of $205,000.Beginning and ending Inventory balances were $40,000 and $45,000,respectively.Accounts Payable balances at the beginning and end of the year were $35,000 and $33,000,respectively.Assuming that all relevant information has been presented,the company would report operating cash flows of:

We report the payment of cash dividends as a cash outflow from investing activities.

The purchase of long-term assets by issuing debt is recorded as both an investing activity and a financing activity.

Dividends received from an investment is classified as a(an) __________ cash flow,and paying dividends on stock issued is classified as a(an) ____________ cash flow on the Statement of Cash Flows.

The three primary categories of cash flows are cash flows from operating activities,cash flows from investing activities,and cash flows from financing activities.

If there are no current assets or liabilities associated with operating expenses,the amounts we report for these expenses in the income statement must equal the amount of cash we paid for these items.

We report interest and dividends received from investments with investing activities.

The balance sheet of Sound Designs reports total assets of $750,000 and $800,000 at the beginning and end of the year,respectively.Sales revenues are $1.5 million ($1.2 million in the previous year) ,net income is $150,000,and net cash flows from operating activities are $175,000.What is Sound Designs' asset turnover?