A mortgage incurred in exchange for an office building would be reported in the statement of cash flows in

 

a.  the cash flows from financing activities section.  

b.  the cash flows from investing activities section. 

c.  a separate schedule.  

d.  the cash flows from operating activities section. 

 

 

Cash received for preferred stock dividends should be shown on the statement of cash flows under

 

a.  investing activities.     

b.  financing activities.  

c.  noncash investing and financing activities.  

d.  operating activities.

 

 

Which of the following should be shown on a statement of cash flows under the financing activity section?

 

a.  The sale of a long-term investment in the common stock of another company  

b.  The payment of cash dividends on common stock

c.  The purchase of a building

d.  The issuance of a long-term note to acquire land

 

 

The net income reported on the income statement for the current year was $295,000. Depreciation recorded on fixed assets and amortization of patents for the year were $30,000 and $4,000, respectively. Balances of current asset and current liability accounts at the end and at the beginning of the year are as follows:

  

 

 

 

What is the amount of cash flows from operating activities reported on the statement of cash flows prepared by the indirect method?

 

a.  $301,000

b.  $357,000 

c.  $352,000  

d.  $233,000

 

 

The net income reported on the income statement for the current year was 275,000. Depreciation recorded on fixed assets and amortization of patents for the year were $30,000 and $4,000, respectively. Balances of current asset and current liability accounts at the end and at the beginning of the year are as follows:

 

 

 

 

What is the amount of cash flows from operating activities reported on the statement of cash flows prepared by the indirect method?

 

a.  $306,000

b.  $357,000  

c.  $324,000

d.  $238,000

 

 

If a gain of $7,000 is incurred in selling (for cash) office equipment having a book value of $55,000, the total amount reported in the cash flows from investing activities section of the statement of cash flows is

 

a.  $48,000.  

b.  $7,000.  

c.  $55,000.  

d.  $62,000. 

 

 

The cost of merchandise sold during the year was $54,000. Merchandise inventories were $10,500 and $12,500 at the beginning and end of the year, respectively. Accounts payable were $6,000 and $9,000 at the beginning and end of the year, respectively. Using the direct method of reporting cash flows from operating activities, cash payments for merchandise total

 

a.  $60,000  

b.  $55,000  

c.  $54,000  

d.  $53,000 

 

 

The following selected account balances appeared on the financial statements of the Sanchez Company:

 

 

 

 

 

The Sanchez Company uses the direct method to calculate net cash flow from operating activities.  Cash collections from customers are 

 

a.  $58,000.  

b.  $62,000.  

c.  $66,000. 

d.  $75,000.

 

 

Operating expenses other than Depreciation for the year were $300,000 prepaid expenses increased by $17,000 and accrued expenses decreased by $30,000 during the year. Cash payments for operating expenses to be reported on the cash flow statement using the direct method would be

 

a.  $253,000.  

b.  $313,000.  

c.  $347,000.      

d.  $283,000.