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101.
Refer to the information above. For the month of October, net cash flows from operating
activities for Waldorf were:
102.
Which of the following activities is
not
a category into which cash flows are classified?
103.
A strong statement of cash flows indicates that significant cash is being generated by:
104.
During the month of May, Henderson Company had the following transactions:
* Revenues of $60,000 were earned and received in cash.
* Bank loans of $9,000 were paid off.
* Equipment of $20,000 was purchased.
* Expenses of $36,800 were paid.
* Stockholders purchased additional shares for $22,000 cash.
A statement of cash flows for May would report net cash flows from operating activities
of:
During the month of August, Boyce Company had the following transactions:
* Revenues of $120,000 were earned and received in cash.
* Bank loans of $18,000 were paid off.
* Equipment of $40,000 was purchased with cash.
* Expenses of $73,600 were paid.
* Stockholders purchased additional shares for $44,000 cash.
105.
Refer to the information above. A statement of cash flows for August, would report net
cash flows from operating activities of:
106.
Refer to the information above. A statement of cash flows for August, would report net
cash flows from financing activities of:
107.
Refer to the information above. A statement of cash flows for August, would report net
cash flows from investing activities of:
108.
Refer to the information above. A statement of cash flows for August, would report an
increase in cash of:
During the month of February, Fadness Company had the following transactions:
* Revenues of $225,000 were earned and received in cash.
* Bank loans of $18,000 were paid off.
* New bank loans of $15,000 were incurred.
* Equipment of $40,000 was purchased with cash.
* Equipment was sold for its book value of $36,000. Cash was received.
* Expenses of $171,400 were paid.
* Stockholders purchased additional shares for $50,000 cash.
109.
Refer to the information above. A statement of cash flows for February, would report net
cash flows from operating activities of:
110.
Refer to the information above. A statement of cash flows for February, would report net
cash flows from financing activities of:
111.
Refer to the information above. A statement of cash flows for February, would report net
cash flows from investing activities of:
112.
Refer to the information above. A statement of cash flows for February, would report an
increase in cash of:
113.
If cash flows from operating activities is a positive amount, then:
114.
The change in owners' equity due to only revenue and expense transactions is explained
by the:
115.
Which one of the following is
not
considered as one of the three primary financial
statements?
116.
The way in which financial statements relate is known as:
117.
Which business organization is recognized as a separate legal entity under the law?
118.
Retained earnings is:
119.
Which of the following best describes liquidity?
120.
Profitability may be defined as:
2-74
121.
The principle of adequate disclosure means that a company should disclose:
122.
Which of the following statements regarding liquidity and profitability is not true?
123.
The concept of adequate disclosure means that:
124.
According to the Sarbanes-Oxley Act, CEOs and CFOs must certify to the accuracy of their
company's financial statements:
2-76
125.
A strong statement of financial position shows:
Essay Questions
126.
Financial statements
A set of financial statements includes three related accounting reports, or statements. In
the space provided, list the names of three primary statements, and give a brief
description of the accounting information contained in each.
127.
Development of generally accepted accounting principles
(A.) What is meant by the phrase "generally accepted accounting principles"?
(B.) Explain the concept of the business entity and how it relates to generally accepted
accounting principles.
128.
Valuation of assets under generally accepted accounting principles
Under generally accepted accounting principles, the assets owned by a business are
reported in the balance sheet at their historical cost. Identify and briefly explain two
accounting principles other than the cost principle that support the valuation of assets at
cost in the balance sheet.
129.
Accounting terminology
Listed below are nine technical accounting terms introduced in this chapter:
Each of the following statements may (or may not) describe one of these technical terms.
In the space provided below each statement, indicate the accounting term described, or
answer "None" if the statement does not correctly describe any of the terms. Do not use a
term more than once.
(A.) Having the financial ability to pay debts as they become due.
(B.) An assumption that a business will operate in the foreseeable future.
(C.) Economic resources owned by businesses that are expected to benefit future
operations.
(D.) The debts or obligations of a business organization.
(E.) Assets = Liabilities + Owners' Equity
(F.) The principle which states that assets are valued in the balance sheet at their
historical cost.
(G.) A residual amount equal to assets minus liabilities.
