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Noncash investing and financing activities may be disclosed in:


A) A note in the financial statements or a schedule attached to the statement of cash flows.
B) The operating activities section of the statement of cash flows.
C) The investing activities section of the statement of cash flows.
D) The financing activities section of the statement of cash flows.
E) The reconciliation of cash balance section.

F) A) and E)
G) C) and D)

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The appropriate section in the statement of cash flows for reporting the purchase of land in exchange for common stock is:


A) Operating activities.
B) Financing activities.
C) Investing activities.
D) Schedule of noncash investing or financing activity.
E) Reconciliation of cash balance.

F) A) and E)
G) None of the above

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The cash flow on total assets ratio is calculated by:


A) Dividing cash flows from operations by average total assets.
B) Dividing total cash flows by average total assets.
C) Dividing average total assets by cash flows from investing activities.
D) Dividing average total assets by total cash flows.
E) Total cash flows divided by average total assets times 365.

F) B) and E)
G) A) and E)

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Use the following income statement and information about selected current assets and current liabilities for Kimberline Industries to calculate the net cash provided or used by operating activities using the indirect method. Use the following income statement and information about selected current assets and current liabilities for Kimberline Industries to calculate the net cash provided or used by operating activities using the indirect method. Increases and decreases of current asset and current liability accounts, all of which relate to operating activities, are as follows: Increases and decreases of current asset and current liability accounts, all of which relate to operating activities, are as follows: Use the following income statement and information about selected current assets and current liabilities for Kimberline Industries to calculate the net cash provided or used by operating activities using the indirect method. Increases and decreases of current asset and current liability accounts, all of which relate to operating activities, are as follows:

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The FASB recommends that the operating section of the statement of cash flows be reported using the direct method.

A) True
B) False

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In preparing a company's statement of cash flows for the most recent year, Ransom Corp. reported the following information: In preparing a company's statement of cash flows for the most recent year, Ransom Corp. reported the following information: Net cash flows from financing activities for the year were: A) $230,000 of net cash used. B) $230,000 of net cash provided. C) $108,000 of net cash used. D) $138,000 of net cash used. E) $138,000 of net cash provideD. Net cash flows from financing activities for the year were:


A) $230,000 of net cash used.
B) $230,000 of net cash provided.
C) $108,000 of net cash used.
D) $138,000 of net cash used.
E) $138,000 of net cash provideD. In preparing a company's statement of cash flows for the most recent year, Ransom Corp. reported the following information: Net cash flows from financing activities for the year were: A) $230,000 of net cash used. B) $230,000 of net cash provided. C) $108,000 of net cash used. D) $138,000 of net cash used. E) $138,000 of net cash provideD.

F) C) and D)
G) A) and C)

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In preparing a company's statement of cash flows for the most recent year, the following information is available: In preparing a company's statement of cash flows for the most recent year, the following information is available: Net cash flows from investing activities for the year were: A) $231,000 of net cash used. B) $39,000 of net cash provided. C) $231,000 of net cash provided. D) $39,000 of net cash used. E) $65,000 of net cash provideD. Net cash flows from investing activities for the year were:


A) $231,000 of net cash used.
B) $39,000 of net cash provided.
C) $231,000 of net cash provided.
D) $39,000 of net cash used.
E) $65,000 of net cash provideD. In preparing a company's statement of cash flows for the most recent year, the following information is available: Net cash flows from investing activities for the year were: A) $231,000 of net cash used. B) $39,000 of net cash provided. C) $231,000 of net cash provided. D) $39,000 of net cash used. E) $65,000 of net cash provideD.

F) C) and E)
G) A) and D)

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The purchase of stock in another company is classified as a financing activity.

A) True
B) False

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Accounting standards:


A) Allow companies to omit the statement of cash flows from a complete set of financial statements if cash is an insignificant asset.
B) Require that companies omit the statement of cash flows from a complete set of financial statements if the company has no investing activities.
C) Require that companies include a statement of cash flows in a complete set of financial statements.
D) Allow companies to include the statement of cash flows in a complete set of financial statements if the cash balance makes up more than 50% of the current assets.
E) Allow companies to omit the statement of cash flows from a complete set of financial statements if the company has no financing activities.

F) D) and E)
G) B) and C)

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The following transactions and events occurred during the year. Assuming that this company uses the indirect method to report cash provided by operating activities, indicate where each item would appear on its statement of cash flows by placing an x in the appropriate column. The following transactions and events occurred during the year. Assuming that this company uses the indirect method to report cash provided by operating activities, indicate where each item would appear on its statement of cash flows by placing an x in the appropriate column.

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In preparing a company's statement of cash flows for the most recent year, the following information is available: In preparing a company's statement of cash flows for the most recent year, the following information is available: Net cash flows from investing activities for the year were: A) $234,000 of net cash used. B) $120,000 of net cash provided. C) $340,000 of net cash used. D) $259,000 of net cash used. E) $280,000 of net cash provideD. Net cash flows from investing activities for the year were:


A) $234,000 of net cash used.
B) $120,000 of net cash provided.
C) $340,000 of net cash used.
D) $259,000 of net cash used.
E) $280,000 of net cash provideD. In preparing a company's statement of cash flows for the most recent year, the following information is available: Net cash flows from investing activities for the year were: A) $234,000 of net cash used. B) $120,000 of net cash provided. C) $340,000 of net cash used. D) $259,000 of net cash used. E) $280,000 of net cash provideD.

F) B) and E)
G) C) and D)

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Noncash financing and investing activities are disclosed in a ____________ to the statement of cash flows or in a separate ______________________________.

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e; schedule at the b...

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The appropriate section in the statement of cash flows for reporting the issuance of common stock for cash is:


A) Operating activities.
B) Financing activities.
C) Investing activities.
D) Schedule of noncash investing or financing activity.
E) This is not reported on the statement of cash flows.

F) A) and B)
G) A) and C)

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Jamison Company reports depreciation expense of $35,000 for Year 2. Also, equipment costing $140,000 was sold for a $5,000 gain in Year 2. The following selected information is available for Jamison Company from its comparative balance sheet. Compute the cash received from the sale of the equipment. Jamison Company reports depreciation expense of $35,000 for Year 2. Also, equipment costing $140,000 was sold for a $5,000 gain in Year 2. The following selected information is available for Jamison Company from its comparative balance sheet. Compute the cash received from the sale of the equipment. A) $23,000. B) $35,000. C) $38,000. D) $40,000. E) $67,000.


A) $23,000.
B) $35,000.
C) $38,000.
D) $40,000.
E) $67,000.

F) None of the above
G) All of the above

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Based on the following information provided about a company's operations, calculate its cost of goods purchased and its cash paid for merchandise. Based on the following information provided about a company's operations, calculate its cost of goods purchased and its cash paid for merchandise.

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A company reported net income of $132,000, operating cash flows of $87,000, total cash flows of $112,000, and average total assets of $1,053,000. Calculate its cash flow on total assets ratio.

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Cash Flow on Total Assets = Op...

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The statement of cash flows explains how transactions and events impact the end-of-period cash balance to produce the end-of-period net income.

A) True
B) False

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Typical cash flows from investing activities include each of the following except:


A) Payments to purchase property, plant and equipment or other productive assets (excluding inventory) .
B) Proceeds from collecting accounts receivable arising from customer sales.
C) Payments to buy intangible assets.
D) Payments to acquire held-to maturity securities of other entities, except cash equivalents.
E) Proceeds from the sale of equipment.

F) A) and C)
G) A) and E)

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The appropriate section in the statement of cash flows for reporting the receipt of cash dividends from investments in securities is:


A) Operating activities.
B) Financing activities.
C) Investing activities.
D) Schedule of noncash investing or financing activity.
E) This is not reported on the statement of cash flows.

F) A) and D)
G) B) and E)

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___________________ activities generally include those transactions and events that affect long-term assets.

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