ACCT 302 Read & Interact Spiceland, Nelson, & Thomas Chapter 21 solutions complete answers

ACCT 302 Read & Interact Spiceland, Nelson, & Thomas Chapter 21 solutions complete answers 

 

Under the indirect method of deriving net cash flows from operating activities, decreases in liabilities relating to operating activities must be

 

Which of the following statements best describes the importance of cash flow information?

 

Which of the following transactions/events commonly give rise to cash outflows of business entities? (Select all that apply.)

 

Which of the following are not valid categories in the statement of cash flows? (Select all that apply.)

 

Short-term, highly liquid investments that can be readily converted to cash, with little risk of loss, are referred to as            .

 

In addition to the primary activities, what other required information must be presented in a statement of cash flows? (Select all that apply.)

 

Which of the following is critically important with respect to the ultimate potential of a firm to provide cash flows to investors and creditors?

 

Net income (or loss) is the result of netting together the       recognized and the       incurred during the current reporting period. (Enter only one word per blank.)

 

Cash flows from       activities are both inflows and outflows of cash that result from activities reported in the income statement.

 

Which of the following are valid categories in the statement of cash flows? (Select all that apply.)

 

The       method of reporting cash flows from operating activities reports the cash effect of each operating activity.

 

Which of the following are required characteristics of cash equivalents? (Select all that apply.)

 

The       method of reporting cash flows from operating activities begins with net income and works backward to derive cash from operating activities.

 

Which of the following are included in the statement of cash flows? (Select all that apply.)

 

Which of the following represent objectives of preparing a statement of cash flows? (Select all that apply.)

 

Which of the following concepts governs recognition of revenue and expense?

 

An important tool that can be used to ensure that no reportable activities are inadvertently overlooked is a:

 

Cash flows from operating activities are both inflows and outflows of cash that result from activities reported in the

 

Which of the following statements regarding income statement and related cash amounts is correct?

 

The method that reports the cash effect of each operating activity explicitly on the statement of cash flows is referred to as the _____ method.

 

The method of presenting the statement of cash flows that begins with a presentation of net income or net loss is referred to as the ____ method.

 

Glueck Corp. reports sales revenue of $200,000. During the year, the company's accounts receivable balance decreased by $14,000. Cash collected from customers is

 

The objective in preparing the statement of cash flows is to identify all transactions and events that represent      ,       and       activities and to classify and list them in the proper format.

 

Glueck Corp. reports sales revenue of $200,000. During the year, the company's accounts receivable balance decreased by $10,000 and its deferred revenue increased by $4,000. Cash collected from customers is

 

An important advantage of using a spreadsheet to analyze transactions that may need to be reported in the statement of cash flows is to

 

Glueck Corp. reports sales revenue of $200,000. During the year, the company's accounts receivable balance decreased by $14,000. Additional information reveals that during the year accounts totaling $7,000 were written off and bad debt expense of $10,000 recognized. A journal entry prepared to determine cash collected from customers would include credits to (Select all that apply.)

 

Margaret is analyzing the current year income statement and the comparative balance sheet in order to prepare the statement of cash flows. She should expect the operating cash flows to be ______ the amounts reported in the income statement.

 

Aggie Company reports investment revenue of $14,000 in its income statement relating to a 5% investment in another company's common stock. During the current year, dividends receivable increased by $1,000. Thus, cash collected from investments will be

 

Sales revenue for the year was $100,000; accounts receivable had a beginning balance of $10,000 and an ending balance of $18,000. Cash collected from customers was

 

Depreciation represents a noncash expense because it is merely an ____ of a ____ cash expenditure.

 

Milky Company reports sales revenue of $200, an increase in deferred revenue of $2, and an increase in accounts receivable of $1. Cash collected from customers is:

 

Kester Corp.'s land account increased by $140,000. No specific information regarding this increase is available. In its statement of cash flows, Kester should report

 

If a journal entry is used to derive the amount of cash collected from customers,

 

Which of the following methods of preparing the statement of cash flows is (are) acceptable under U.S. GAAP? (Select all that apply.)

 

Under the indirect method of preparing the statement of cash flows, depreciation expense and losses are added back to net income because they (Select all that apply.)

 

Jasper's income statement reports revenue from investments that lack significant influence of $10,000, and its balance sheet reports that dividends receivable decreased by $1,500. How much will Jasper report as cash received from investments?

 

Kunzen Company shows salaries expense of $15,000 in its income statement. During the current year, the balance of its salaries payable account increased by $2,000. If the company uses the indirect method of presenting the operating activities section of the statement of cash flows, the change of $2,000 should be

 

Which of the following is correct regarding depreciation expense?

 

Under the indirect method of deriving net cash flows from operating activities, increases in assets relating to operating activities must be

 

Michal Corp.'s land account decreased by $250,000. No specific information regarding this decrease is available. In its statement of cash flows, Michael should report

 

Under which method(s) will a reconciliation of net income to cash from operating activities be presented? (Select all that apply.)

 

If a spreadsheet is used to assist in the preparation of a statement of cash flows, an income statement section is NOT included under the       method.

 

When preparing the statement of cash flows using the indirect method, depreciation expense and losses are

 

The objective of the T-account and the spreadsheet approaches is to explain the

 

Gerta Company shows salaries expense of $30,000 in its income statement. During the current year, the balance of its salaries payable account increased by $4,000. If the company uses the indirect method of presenting the operating activities section of the statement of cash flows, the change of $4,000 should be

 

Under the indirect method of deriving net cash flows from operating activities, decreases in assets relating to operating activities must be

 

Under which method of preparing a statement of cash flows will a reconciliation between net income and cash from operating activities be shown on a separate schedule?

 

Correctly match the method of preparing the statement of cash flows with the type of items found in a spreadsheet used to help prepare the statement.

 

What aspect(s) are common to both the spreadsheet approach and the T-account approach for the preparation of a statement of cash flows? (Select all that apply.)

 

 

 
Amounts reported in the income statement usually are ______ the cash effects of the items reported.
 
 
 
Carmen Company shows salaries expense of $25,000 in its income statement. During the current year, the balance of its salaries payable account decreased by $3,000. If the company uses the indirect method of presenting the operating activities section of the statement of cash flows, the change of $3,000 should be
 
 
 
Cash flows from ___________ activities are both outflows and inflows of cash caused by the acquisition and disposal of long-term assets.
 
 
 
A cash inflow from the sale of land is categorized as a(n)
 
 
 
Cash received from the sale of common and preferred stock and the issuance of bonds and other debt securities are reported on the statement of cash flows as ________________ activities
 
 
 
During the current period, Kunzen Corp. disposed of old equipment and received $2,000 cash; purchased new equipment for $20,000 cash; collected an accounts receivable balance of $2,500; and purchased an investment for $3,000. Net cash from investing activities is (indicate the amount and whether it is a net inflow or outflow)
 
 
 
During the current period, Schmidt Corp. disposed of old equipment and received $1,000 cash; purchased new equipment for $10,000 cash; paid an accounts payable balance of $2,500; and sold an investment costing $2,000 for $2,800. Net cash from investing activities is (indicate the amount and whether it is a net inflow or outflow)
 
 
 
During the current year Hainzel Corp. sold inventory costing $200,000 for $500,000. The balance of accounts payable decreased by $20,000, and the balance of the inventory account decreased by $10,000. Cash paid to suppliers is
 
 
 
During the current year Mainzel Corp. sold inventory costing $100,000 for $220,000. The balance of accounts payable increased by $10,000, and the balance of the inventory account increased by $6,000. Cash paid to suppliers is
 
 
 
During the current year Mainzel Corp. sold inventory costing $100,000 for $220,000. The balance of accounts payable increased by $10,000, and the balance of the inventory account increased by $6,000. The journal entry to derive cash paid to vendors would include credits to (Select all that apply.)
 
 
 
During the current year, Mainzel Corp. sold inventory costing $100,000 for $220,000. The company's accounts payable balance increased by $10,000, and the inventory account balance increased by $6,000. The journal entry to derive cash paid to vendors would include debits to (Select all that apply.)
 
 
 
Fault Company's records indicate that, during the current year, land costing $150,000 was sold. A loss of $25,000 was recognized on the sale. Cash inflows associated with this sale were
 
 
 
Financing activities are inflows and outflows of cash resulting from the
 
 
 
Glueck Corp. reports sales revenue of $200,000. During the year, the company's accounts receivable balance decreased by $14,000. Additional information reveals that during the year accounts totaling $7,000 were written off and bad debt expense of $10,000 was recognized. A journal entry prepared to determine cash collected from customers would include debits to (Select all that apply.)
 
 
 
In a statement of cash flows—direct method, depreciation expense should
 
 
 
 
 
 
 
 
 
 
 

 
Inflows and outflows of cash resulting from the external funding of a business are cash flows from _____________ activities
 
 
 
Marten Company's records indicate that, during the current year, land costing $50,000 was sold. A gain of $45,000 was recognized on the sale. Cash inflows associated with this sale were
 
 
 
Milky Company reports sales revenue of $200, an increase in deferred revenue of $2, and an increase in accounts receivable of $1. Using a journal entry to determine cash collected from customers, accounts receivable should be ____ and deferred revenue ___.
 
 
 
To identify all the operating, investing, and financing activities using a spreadsheet, we must account for the changes in each account on the: (Select all that apply.)
 
 
 
Under the indirect method of deriving net cash flows from operating activities, increases in liabilities relating to operating activities must be
 
 
 
 
 
 
 
 
 

 
Which accounts or balances must be considered in order to calculate the amount of cash paid to suppliers for inventory? (Select all that apply.)
 
 
 
Which of the following decision makers tend to be especially interested in cash flow information? (Select all that apply.)
 
 
 
Which of the following statements is correct with respect to analyzing accounts for the preparation of a statement of cash flows? (Select all that apply.)
 
 
 
Which of the following statements regarding the recognition of revenues and expenses is correct?
 
 
 
 
 
 
 
 
 

 
Which of the following transactions/events commonly give rise to cash inflows for business entities? (Select all that apply.)
 
 
 
Which of the following transactions would be classified as financing activities in the statement of cash flows? (Select all that apply.)
 
 
 
Which of the following would result in a cash inflow from investing activities?
 
 
 
Which of the following would result in a cash outflow from investing activities?
 
 
 
Wichtel Corp. reports sales revenue of $400,000. During the year, the company's accounts receivable balance decreased by $10,000 and its deferred revenue decreased by $6,000. Cash collected from customers is