Question :
71. During Year 4, Charley Company had a net increase in : 1230448
71. During Year 4, Charley Company had a net increase in accounts payable for purchases on account. Accounting classifies this source of cash in the _____ section of the statement of cash flows.
A. Investing
B. Operations
C. Financing
D. Exchange
E. Funds Flow
72. During Year 6, Delta Company had a net $4,000 increase in customer advances. The T-account work sheet for preparing the statement of cash flows
A. subtracts this excess from net income in deriving cash flow from operating activities.
B. adds this excess to net income in deriving cash flow from financing activities.
C. adds this excess to net income in deriving cash flow from operating activities.
D. subtracts this excess from net income in deriving cash flow from financing activities.
E. subtracts this excess from retained earnings in deriving cash flow from operating activities.
73. During Year 7, Frank Company had a net increase in accounts receivable of $10,000. The T-account work sheet for preparing the statement of cash flows
A. adds the increase in accounts receivable in deriving cash flow from operating activities.
B. subtracts the increase in accounts receivable in deriving cash flow from operations.
C. adds the increase in accounts receivable in deriving cash flow from financing activities.
D. subtracts the increase in accounts receivable in deriving cash flow from financing activities.
E. subtracts the increase in accounts receivable in deriving cash flow from investing activities.
74. In Year 8, Global Marketing Corporation had a net increase in inventories of $50,000. The T-account work sheet for preparing the statement of cash flows
A. adds this change in inventory in deriving cash flow from operating activities.
B. adds this change in inventory in deriving cash flow from financing activities.
C. subtracts this change in inventory in deriving cash flow from operating activities.
D. subtracts this change in inventory in deriving cash flow from financing activities.
E. subtracts this change in inventory in deriving cash flow from investment activities.
75. During Year 9, Happy Motors Corp. had a net $100,000 decrease in Warranties Payable. The T-account work sheet for preparing the statement of cash flows
A. adds this decrease in Warranties Payable so that cash flow from operations reports cash expenditures, not expenses.
B. subtracts this decrease in Warranties Payable so that cash flow from operations reports cash expenditures, not expenses.
C. adds this decrease in Warranties Payable so that cash flow from operations reports cash expenses, not expenditures.
D. subtracts this decrease in Warranties Payable so that cash flow from operations reports cash expenses, not expenditures.
E. subtracts this decrease in Warranties Payable so that cash flow from financing reports cash expenses, not expenditures.
76. King Corporation borrowed $75,000 during Year 2 from its bank under a short-term borrowing arrangement. The statement of cash flows for King Corporation classifies the transaction as a(n)
A. operating activity
B. investing activity.
C. financing activity.
D. lending activity.
E. exchange activity.
77. Queen Corporation borrowed $750,000 during Year 3 from its bank under a long-term borrowing arrangement. The statement of cash flows classifies the transaction as a(n)
A. operating activity.
B. investing activity.
C. financing activity.
D. exchange transaction.
E. lending activity.
78. Jack Corporation issued preferred stock totaling $10,000,000 during Year 4. The statement of cash flows classifies the transaction as a(n)
A. operating activity.
B. investing activity.
C. financing activity.
D. exchange transaction.
E. equity transaction.
79. Ten Corporation retired $7,500,000 of long-term debt at maturity. The income statement shows no gain or loss on retirement of debt. The statement of cash flows classifies the transaction as a(n)
A. operating activity
B. investing activity.
C. financing activity.
D. exchange transaction.
E. lending activity.
80. Nine Corporation acquired 1,000,000 shares of its own common stock for $10,000,000 during Year 2. The statement of cash flows classifies the transaction as a(n)
A. exchange transaction.
B. investing activity.
C. financing activity.
D. operating activity.
E. equity activity.
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