chapter 17 practice Flashcards
Which of the following is incorrect about the statement of cash flows?
It reconciles the ending cash account balance to the balance per the bank statement.
The best measure of a company’s ability to generate sufficient cash to continue as a going concern is net cash provided by
operating activites
Accounts receivable arising from sales to customers amounted to $80,000 and $70,000 at the beginning and end of the year, respectively. Income reported on the income statement for the year was $240,000. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows is
250,000
Under the indirect method of preparing the statement of cash flows, which of the following is added to net income in the operating activities section?
depreciation expense
In Angel Company, the Land account decreased $90,000 as a result of a cash sale for $100,000 and recognized a gain on the sale of $10,000. The Equipment account increased $20,000 as a result of a cash purchase. Angel Company also purchased a truck for $25,000 by issuing a five-year note. Bonds payable increased from an issuance of bonds for cash for $50,000. The net cash provided by investing activities is
80,000
DV’s Pest Control Products has the following information available: net income, $15,000; cash provided by operating activities, $21,000; cash sales, $65,000; capital expenditures, $11,000; and dividends paid, $3,000. What is DV’s free cash flow?
7,000
The beginning balance in accounts receivable is $44,000, the ending balance is $42,000, and sales revenue during the period are $129,000. What are cash receipts from customers?
131,000
When listing accounts in the statement of cash flows worksheet, the Accumulated Depreciation account is shown
with accounts that have credit balances.
The sale of equipment would require a
debit to the Cash T-account in the investing section.
IFRS requires that noncash items
be disclosed in the notes to the financial statements.
