Question :
61. Activities that involve the production or purchase of merchandise and : 1256436
61. Activities that involve the production or purchase of merchandise and the sale of goods and services to customers, including expenditures related to administering the business, are classified as:
A. Financing activities
B. Investing activities
C. Operating activities
D. Direct activities
E. Indirect activities
62. The appropriate section in the statement of cash flows for reporting the receipt of cash dividends from investments in securities is:
A. Operating activities.
B. Financing activities.
C. Investing activities.
D. Schedule of noncash investing or financing activity.
E. None of these as this is not reported on the statement of cash flows.
63. Which one of the following is representative of typical cash flows from operating activities?
A. Proceeds from collecting the principal amount of loans.
B. Repayment of principal on loans.
C. Proceeds from the issuance of bonds and notes payable.
D. Payments by a merchandiser to acquire equity securities of other companies.
E. Receipts of cash sales.
64. Cash flows from selling trading securities are reported in the statement of cash flows as part of:
A. Operating activities.
B. Financing activities.
C. Investing activities.
D. Noncash activities.
E. None of these as this is not reported in the statement of cash flows.
65. Cash flows from interest received are reported in the statement of cash flows as part of:
A. Operating activities.
B. Financing activities.
C. Investing activities.
D. Noncash activities.
E. None of these as this is not reported in the statement of cash flows.
66. The accounting principle that requires significant noncash financing and investing activities be reported on the statement of cash flows is the:
A. Historical cost principle
B. Materiality principle
C. Full disclosure principle
D. Going concern principle
E. Business entity principle
67. The appropriate section in the statement of cash flows for reporting the purchase of land in exchange for common stock is:
A. Operating activities.
B. Financing activities.
C. Investing activities.
D. Schedule of noncash investing or financing activity.
E. None of these as this is not reported on the statement of cash flows.
68. The purchase of long-term assets by issuing a note payable for the entire amount is reported on the statement of cash flows in the:
A. Operating activities.
B. Financing activities.
C. Investing activities.
D. Schedule of noncash financing and investing activities.
E. None of these as this is not reported on the statement of cash flows.
69. Accounting standards:
A. Allow companies to omit the statement of cash flows from a complete set of financial statements if cash is an insignificant asset.
B. Require that companies omit the statement of cash flows from a complete set of financial statements if the company has no investing activities.
C. Require that companies include a statement of cash flows in a complete set of financial statements.
D. Allow companies to include the statement of cash flows in a complete set of financial statements if the cash balance makes up more than 50% of the current assets.
E. Allow companies to omit the statement of cash flows from a complete set of financial statements if the company has no financing activities.
70. The cash flow on total assets ratio:
A. Is the same as return on assets.
B. Is the same as profit margin.
C. Can be an indicator of earnings quality.
D. Is highly affected by accounting principles of income recognition and measurement.
E. Is average net assets divided by cash flows from operations.
