11) The following information is from ABC, Inc.’s December 31, 2011 annual report:
Income statement
Balance sheet
12/31/11
12/31/10
Sales revenue
$800,000
Unearned revenue
$8,000
$10,000
Interest expense
$30,000
Interest payable
$1,000
$3,000
Note: ABC, Inc. does not sell to its customers on account; it collects cash from its customers in advance.
Cash collected from customers on ABC, Inc.’s statement of cash flows equals ________.
A) $800,000
B) $802,000
C) $798,000
D) $810,000
12) The following information is from ABC, Inc.’s December 31, 2011 annual report:
Income statement
Balance sheet
12/31/11
12/31/10
Sales revenue
$800,000
Unearned revenue
$8,000
$10,000
Interest expense
$30,000
Interest payable
$1,000
$3,000
Note: ABC, Inc. does not sell to its customers on account; it collects cash from its customers in advance.
Cash paid for interest on ABC, Inc.’s statement of cash flows equals ________.
A) $30,000
B) $28,000
C) $33,000
D) $32,000
13) The following information is from Cogs, Inc.’s December 31, 2011 annual report:
Income statement
Balance sheet
12/31/11
12/31/10
Cost of goods sold
$100,000
Inventory
$8,000
$10,000
Accounts payable
$7,000
$5,000
Cash paid to vendors on Cogs, Inc.’s statement of cash flows equals ________.
A) $100,000
B) $110,000
C) $104,000
D) $96,000
14) The following information is from ABC, Inc.’s December 31, 2011 annual report:
Income statement
Balance sheet
12/31/10
12/31/11
Cost of goods sold
$100,000
Inventory
$8,000
$10,000
Accounts payable
$7,000
$5,000
Cash paid to vendors on ABC, Inc.’s statement of cash flows equals ________.
A) $100,000
B) $110,000
C) $104,000
D) $96,000
15) The following information is from Ads, Inc.’s December 31, 2011 annual report:
Income statement
Balance sheet
12/31/10
12/31/11
Sales
$250,000
Cost of goods sold
$100,000
Accounts receivable
$15,000
$20,000
Inventory
$8,000
$10,000
Accounts payable
$7,000
$5,000
Cash collected from customers on Ads, Inc.’s statement of cash flows equals ________.
A) $250,000
B) $220,000
C) $255,000
D) $245,000
16) The following information is from Ads, Inc.’s December 31, 2011 annual report:
Income statement
Balance sheet
12/31/10
12/31/11
Sales
$250,000
Cost of goods sold
$110,000
Accounts receivable
$15,000
$20,000
Inventory
$5,000
$10,000
Accounts payable
$7,000
$5,000
Cash paid to vendors on Ads, Inc.’s statement of cash flows equals ________.
A) $100,000
B) $110,000
C) $117,000
D) $103,000
17) The following information is from Daffy Duct, Inc.’s December 31, 2011 annual report:
Income statement
Balance sheet
12/31/11
12/31/10
Sales revenue
$100,000
Accounts receivable
$8,000
$10,000
Salary expense
$60,000
Salary payable
$2,000
$4,000
Supplies expense
$10,000
Supplies
$1,000
$2,000
Net cash from operating activities on Daffy Duct’s statement of cash flows equals ________.
A) $30,000
B) $29,000
C) $33,000
D) $31,000
18) Clean Dirt, Inc. had $8,000 of salaries payable at December 31, 2010. During 2011, Clean Dirt’s salary expense was $60,000. At December 31, 2011, Clean Dirt’s statement of cash flows showed cash paid for salaries of $(63,000). How much was Clean Dirt’s salaries payable balance on its December 31, 2011 balance sheet?
A) $5,000
B) $11,000
C) $13,000
D) $3,000
19) Clean Dirt, Inc. had $10,000 of accounts receivable at December 31, 2010. During 2011, Clean Dirt’s sales were $100,000. At December 31, 2011, Clean Dirt’s statement of cash flows showed cash collected from customers of $102,000. How much was Clean Dirt’s accounts receivable balance on its December 31, 2011 balance sheet?
A) $12,000
B) $10,000
C) $8,000
D) $2,000
20) A statement of cash flows based on the direct method is prepared by converting every number on the income statement to its cash amount.
21) A statement of cash flows based on the indirect method is prepared by converting every number on the income statement to its cash amount.
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