Question :
41. The payment of a cash dividend will be depicted the : 1291651
41. The payment of a cash dividend will be depicted on the statement of cash flows as a: A. cash inflow from an operating activity.B. cash outflow for an investing activity.C. cash outflow for a financing activity.D. cash outflow for an operating activity.
42. Burrows Inc. had an outstanding loan at the beginning of 2011 totaling $50,000. During 2011, $16,800 was paid out related to this loan broken down as follows: $15,000 towards principal and $1,800 in interest. Which of the following statements is correct regarding how the $16,800 payment should be depicted on the statement of cash flows? A. The entire $16,800 should be shown as a cash outflow for financing activities.B. The entire $16,800 should be shown as a cash outflow for investing activities.C. The $15,000 principal portion should be shown as a cash outflow for financing activities, and the $1,800 in interest should be shown as a cash outflow for operating activities.D. The $15,000 principal portion should be shown as a cash outflow for investing activities, and the $1,800 in interest should be shown as a cash outflow for operating activities.
43. Felton Inc. had the following information related to last year’s purchases:
Cost of goods purchased
$300,000
Accounts payable – beginning
12,500
Accounts payable – ending
20,000
What amount would be reported as “cash outflows for purchases” on the statement of cash flows using the direct method? A. $307,500B. $292,500C. $312,500D. $280,000
44. Clyde’s Clothing Inc. comparative balance sheets and income statements showed the following information for 2010 and 2011:
Inventory – 12/31/2010
$ 60,000
Inventory – 12/31/2011
75,000
Accounts payable – 12/31/2010
18,000
Accounts payable – 12/31/2011
20,000
Cost of goods sold – 2011
400,000
Clyde’s accounts payable balances are composed solely of amounts due to suppliers for purchases of inventory. What is the amount of cash payments for inventory that Clyde should report on its 2011 statement of cash flows assuming that the direct method is used? A. $387,000B. $413,000C. $497,000D. $303,000
45. Skipper’s Souvenir Shop had comparative balance sheets and income statements that showed the following information for 2010 and 2011:
Inventory – 12/31/10
$100,000
Inventory – 12/31/11
85,000
Accounts payable – 12/31/10
20,000
Accounts payable – 12/31/11
15,000
Cost of goods sold – 2011
700,000
Skipper’s accounts payable balances are composed solely of amounts due to suppliers for purchases of inventory. What is the amount of cash payments for inventory that Skipper should report on its 2011 statement of cash flows assuming that the direct method is used? A. $690,000B. $710,000C. $850,000D. $550,000
46. Gregson Company had the following noncash current asset and current liabilities balances at the end of 2010 and 2011:
2010
2011
Accounts receivable
$ 60,000
$ 68,000
Inventory
230,000
210,000
Prepaid insurance
15,000
13,000
Accounts payable
20,000
30,000
Net income for 2011 was $750,000 and depreciation expense was $40,000. All sales and all purchases are on account. Gregson uses the indirect method for preparing the statement of cash flows.Net cash flows from operating activities for 2011 would be: A. $814,000B. $774,000C. $786,000D. $766,000
47. Atlantic Inc. had the following noncash current asset and current liabilities balances at the end of 2010 and 2011:
2010
2011
Accounts receivable
$ 50,000
$ 42,000
Inventory
190,000
160,000
Prepaid insurance
10,000
6,000
Accounts payable
25,000
30,000
Net income for 2011 was $940,000 and depreciation expense was $25,000. All sales and all purchases are on account. Atlantic uses the indirect method for preparing the statement of cash flows.Net cash flows from operating activities for 2011 would be: A. $ 918,000B. $1,012,000C. $1,002,000D. $ 987,000
48. Crenshaw Inc. had the following information related to last year’s purchases:
Cost of goods purchased
$510,000
Accounts payable – beginning
35,000
Accounts payable – ending
18,000
What amount would be reported as “cash outflows for purchases” on the statement of cash flows using the direct method? A. $527,000B. $493,000C. $475,000D. $457,000
49. Haley Inc. had the following information related to last year’s purchases:
Cost of goods purchased
$85,000
Accounts payable – beginning
3,000
Accounts payable – ending
5,000
What amount would be reported as “cash outflows for purchases” on the statement of cash flows using the direct method? A. $93,000B. $87,000C. $77,000D. $83,000
50. Caldwell Corp.’s cost of goods purchased amounts to $900,000 for 2011. From the beginning until the end of 2011, their accounts payable decreased by a net amount of $95,000. How much “cash outflows for purchases” should Caldwell report for 2011 on their statement of cash flows? A. $ 95,000B. $900,000C. $995,000D. $805,000
