Question : 21. Given the following events, which ones affect cash flows from : 1295737

 

 

21. Given the following events, which ones affect cash flows from investing activities? 

1.

collection from issuing capital stock

2.

payment of a dividend

3.

purchases of property, plant, and equipment

4.

collection from the sale of property, plant, and equipment

 

 

 A. 1 and 2B. 3 and 4C. 2 and 4D. 1, 2, 3, and 4

 

22. Given the following events, which ones affect cash flows from financing activities? 

1.

collection from issuing capital stock

2.

payment of a dividend

3.

purchases of property, plant, and equipment

4.

collection from the sale of property, plant, and equipment

 

 

 A. 1 and 2B. 3 and 4C. 2 and 4D. 1, 2, 3, and 4

 

23. Which of the following statements is true about the indirect method of preparing the operating activities section on a statement of cash flows? A. It adjusts cash basis net income to accrual basis net income.B. It adjusts accrual basis net income to cash provided by operating activities.C. It adjusts accrual basis net income to budgeted net income.D. It adjusts cash basis net income to budgeted net income.

 

24. Burke Inc.’s accounts receivable balance increased during the year from $300,000 to $360,000. Based on this information, which of the following statements is true? A. Cash received from customers was greater than sales revenue recorded during the year.B. Cash received from customers was less than sales revenue recorded during the year.C. Cash received from customers was exactly equal to sales revenue recorded during the year.D. Cash received from customers was higher than cash paid to suppliers during the year.

 

25. The direct and indirect methods affect which section(s) on a statement of cash flows? A. Operating activities section onlyB. Investing activities section onlyC. Both operating and investing activitiesD. Both investing and financing activities

 

26. Paxton Inc. had the following information related to last year’s sales: 

Cash sales

$  75,000

Credit sales

140,000

Accounts receivable – beginning

15,000

Accounts receivable – ending

28,000

 

 

What amount would be reported as “cash collections from customers” on the statement of cash flows using the direct method? A. $202,000B. $127,000C. $228,000D. $172,000

 

27. Culpepper Inc. had the following information related to last year’s sales: 

Cash sales

$  490,000

Credit sales

300,000

Accounts receivable – beginning

43,000

Accounts receivable – ending

30,000

 

 

What amount would be reported as “cash collections from customers” on the statement of cash flows using the direct method? A. $833,000B. $863,000C. $803,000D. $777,000

 

28. Pomander Inc. had the following information related to last year’s sales: 

Cash sales

$  215,000

Credit sales

500,000

Accounts receivable – beginning

20,000

Accounts receivable – ending

28,000

 

 

What amount would be reported as “cash collections from customers” on the statement of cash flows using the direct method? A. $667,000B. $763,000C. $723,000D. $707,000

 

29. Jazzy Inc. reported sales revenue of $300,000 on their income statement in 2008. From the beginning until the end of 2008, accounts receivables increased by a net amount of $40,000. How much “cash collections from customers” should Jazzy report for 2008 on their statement of cash flows? A. $300,000B. $340,000C. $260,000D. $  40,000

 

30. Chatham Corp. reported sales revenue of $850,000 on their income statement for 2008. From the beginning until the end of 2008, accounts receivables decreased by a net amount of $100,000. How much “cash collections from customers” should Chatham report for 2008 on their statement of cash flows? A. $100,000B. $750,000C. $850,000D. $950,000