Question :
21. The statement of cash flows explains the reasons for the : 1245806
21. The statement of cash flows explains the reasons for the change in cash and cash equivalents during a period. This statement classifies the reasons as relating to
A. operating decisions, only.
B. investing decisions, only.
C. financing decisions, only.
D. operating, investing, or financing decisions.
E. operating, investing, financing, or exchange decisions.
22. Which of the following is/are true?
A. Revenues from sales of goods or services to customers during a particular period do not necessarily equal cash received from customers during the same period.
B. The receipt of cash can precede, coincide with, or follow the recognition of revenue.
C. Expenses incurred to generate revenues during a particular period do not necessarily equal cash expended for the goods and services consumed in operations during the same period.
D. The expenditure of cash can precede, or coincide with, or follow the recognition of expenses.
E. all of the above
23. Which of the following is/are not true?
A. Revenues from sales of goods or services to customers during a particular period do not necessarily equal cash received from customers during the same period.
B. The receipt of cash can precede, coincide with, or follow the recognition of revenue.
C. Expenses incurred to generate revenues during a particular period do not necessarily equal cash expended for the goods and services consumed in operations during the same period.
D. The expenditure of cash can precede, coincide with, or follow the recognition of expenses.
E. The net income for a particular period will likely equal the cash flow from operations for the same period.
24. Firms typically report cash flows from operations using the indirect method. The indirect
method starts with net income, then adds any expense amount that does not use cash, and subtracts any revenue amount that does not provide cash. The adjustments to convert net income to cash flow from operations generally does not involve
A. adding the amount by which an expense exceeds the related cash expenditure for the period.
B. subtracting the amount by which a revenue exceeds the related cash receipt for the period.
C. adding credit changes in operating non-cash working capital accounts.
D. subtracting debit changes in operating working capital accounts.
E. subtracting the amount by which an expense exceeds the related cash expenditure for the period.
25. Cash flow from investing activities includes
A. cash purchases of property, plant, and equipment.
B. cash sales of marketable securities and investments in securities.
C. cash sales of property, plant, and equipment.
D. cash sales of intangibles.
E. all of the above
26. Cash flow from investing activities does not include
A. cash purchases of property, plant, and equipment.
B. cash sales of marketable securities and investments in securities.
C. cash sales of property, plant, and equipment.
D. cash sales of intangibles.
E. cash purchases of treasury stock.
27. Cash flow from financing activities include(s)
A. cash issues of long-term borrowings.
B. cash redemptions of long-term borrowings.
C. cash sales and cash repurchases of common and preferred shares.
D. cash dividends.
E. all of the above.
28. Cash flow from financing activities do not include
A. cash issues of long-term borrowings.
B. cash redemptions of long-term borrowings.
C. cash sales and cash repurchases of common and preferred shares.
D. cash payments of interest.
E. all of the above.
29. Some investing and financing transactions do not involve cash and therefore
A. appear on the statement of cash flows under operating, investing or financing activities, as appropriate.
B. appear on the statement of cash flows under operating activities.
C. appear on the statement of cash flows under operating or financing activities, as appropriate.
D. appear on the statement of cash flows under investing or financing activities, as appropriate.
E. do not appear on the statement of cash flows.
30. What method starts with the total for net income and adjusts for expenses and revenues not using or producing cash, then removes the effects of nonoperating gains and losses or any balance sheet changes involving non-cash operating accounts?
A. direct method for calculating the cash flows from investing.
B. indirect method for calculating the cash flows from investing.
C. indirect method for calculating the cash flows from financing.
D. direct method for calculating the cash flows from operations.
E. indirect method for calculating the cash flows from operations.
