51.
On a spreadsheet used to prepare the operating activities section of the statement of cash
flows, depreciation expense does not require an entry in the Analysis of Changes columns
because it is a noncash item.
52.
When using a spreadsheet to prepare the statement of cash flows, a decrease in accounts
payable is entered in the Analysis of Changes columns with a debit in the statement of
cash flows section and a credit in the balance sheet section.
53.
Depreciation expense is not reported on a statement of cash flows prepared under the
direct method.
54.
The FASB requires a reconciliation of net income to net cash provided or used by
operating activities when the direct method is used (which can be reported in the notes).
55.
The gain or loss from retirement of debt is reported under cash flows from operating
activities on the statement of cash flows using the direct method.
Multiple Choice Questions
56.
The statement of cash flows reports:
57.
The statement of cash flows reports all but which of the following?
58.
The statement of cash flows is:
59.
A cash equivalent satisfies which of the following criteria?
60.
An investment that is readily convertible to a known amount of cash and that is sufficiently
close to its maturity date so that its market value is unaffected by interest rate changes is
a(n):
61.
Activities that involve the production or purchase of merchandise and the sale of goods
and services to customers, including expenditures related to administering the business,
are classified as:
62.
The appropriate section in the statement of cash flows for reporting the purchase of
equipment for cash is:
63.
Which of the following items is reported on the statement of cash flows under financing
activities?
64.
Investing activities do not include the:
65.
The appropriate section in the statement of cash flows for reporting the cash payment of
wages is:
66.
The appropriate section in the statement of cash flows for reporting the issuance of
common stock for cash is:
67.
A company’s transactions with its creditors to borrow money and/or to repay the principal
amounts of both short– and long-term debt are reported as cash flows from:
68.
The appropriate section in the statement of cash flows for reporting the receipt of cash
dividends from investments in securities is:
69.
Which one of the following is representative of typical cash flows from operating
activities?
70.
Typical cash flows from investing activities include each of the following
except
:
71.
If a company borrows money from a bank, the interest paid on this loan should be reported
on the statement of cash flows as a(n):
72.
Cash flows from selling trading securities are usually reported in the statement of cash
flows as part of:
73.
Which of the following is included in the cash flows from financing activities section of the
statement of cash flows?
74.
Cash flows from interest received on loans are reported in the statement of cash flows as
part of:
75.
The accounting principle that requires important noncash financing and investing activities
be reported on the statement of cash flows or in a footnote is the:
76.
The appropriate section in the statement of cash flows for reporting the purchase of land
in exchange for common stock is:
77.
The purchase of long-term assets by issuing a note payable for the entire amount is
reported on the statement of cash flows in the:
78.
An example of a transaction that must be disclosed as a noncash investing and financing
activity includes all but which of the following?
79.
Noncash investing and financing activities may be disclosed in:
80.
Accounting standards:
81.
Common uses of the statement of cash flows include all but which of the following?
82.
The statement of cash flows helps analysts evaluate all but which of the following?
83.
The statement of cash flows cannot help address questions such as:
84.
The cash flow on total assets ratio: