FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 8: Reporting and Analyzing Cash Flows

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 21

Multiple Choice

Review LaterAdd Note

Review Later

In each of the following cases,use the information provided about the current year operations of Ivy Company to calculate the indicated cash flow item. $\begin{array}{|l|l|r|}\hline \text { Case A: } & \text { Calculate cash received from dividends } & ? \\\hline & \text { Dividend revenue } & 14,900 \\\hline & \text { Dividends receivable January 1 } & 1,400 \\\hline & \text { Dividends receivable December 31 } & 1,700 \\\hline\end{array}$

A) Case A = $14,600; Case B = $81,000
B) Case A = $14,900; Case B = $78,900
C) Case A = $15,300; Case B = $81,000
D) Case A = $14,600; Case B = $78,900
E) Case A = $14,900; Case B = $84,000

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

Correct Answer

verified

Show Answer

Question 22

True/False

Review LaterAdd Note

Review Later

Cash dividends and interest received can only be considered cash inflows from investing activities.

A) True
B) False

Correct Answer

verified

Show Answer

Question 23

Essay

Review LaterAdd Note

Explain how the cash flows from operating activities section of the statement of cash flows is prepared using the indirect method.

Which one of the following is representative of typical cash flows from operating activities?

Bad debts expense is an item that does not provide or use cash.

Cash flows from cash dividends and interest received are reported in the statement of cash flows as

The direct method calculates the net cash inflows (outflows)from operating activities by adjusting accrual profit to a cash basis.

Does an overall increase in the Cash balance represent a favourable situation for a company? Explain.

Noncash financing activities are disclosed in a note in the financing section of the statement of cash flows.

Amy Corporation's income statement showed the following: profit,$72,000; depreciation expense,$8,000; and gain on sale of plant assets,$6,000.An examination of the company's current assets and current liabilities showed the following changes as a result of operating activities: accounts receivable decreased $5,700; merchandise inventory increased $8,000; prepaid expenses decreased $2,100; accounts payable increased $1,700.Calculate the net cash provided (or used) by operating activities.

The first item reported in the operating activities section for a statement of cash flows prepared according to the indirect method is

The direct method is required by IFRS because it provides greater detail regarding operating cash flows.

Which of the following items is reported in the body of the statement of cash flows?

The statement of cash flows explains the difference between the beginning and ending balances of cash and cash equivalents.

Typical cash flows from investing activities include

The direct method of preparing the statement of cash flows separately lists each major item of operating cash receipts and each major item of operating cash payments.

The Merchandise Inventory for Year 1 was $100,000 and for Year 2 was $94,000.The Accounts Payable account for Year 1 was $40,000 and for Year 2 was $42,000.Cost of goods sold for Year 2 was $460,000.What was the total amount for cash payments for merchandise for Year 2?

The three-step process in determining net cash inflows (outflows)from investing activities are: (1)identify changes in investing-related accounts; (2)explain these changes using reconstruction analysis; (3)report cash flow effects.

On the statement of cash flows,business operations are classified as operating,investing,or financing activities.

Changes in notes payable,non-current liabilities,and equity accounts are usually used in calculating and reporting