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Exam 16: Statement of Cash Flows

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Question 101

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On the basis of the following data for Garrett Co. for Years 1 and 2 ended December 31, prepare a statement of cash flows using the indirect method of reporting cash flows from operating activities. Assume that equipment costing $125,000 was purchased for cash and equipment costing $85,000 with accumulated depreciation of $65,000 was sold for $15,000; that the stock was issued for cash; and that the only entries in the retained earnings account were for net income of $56,000 and cash dividends declared of $18,000.​

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Question 102

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Durrand Corporation's accumulated depreciation increased by $12,000, while patents decreased by $2,200 between consecutive balance sheet dates. There were no purchases or sales of depreciable or intangible assets during the year. In addition, the income statement showed a gain of $4,300 from sale of land. The company earned a net income of $65,000. Determine net cash flow from operating activities under the indirect method.

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Question 103

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On the statement of cash flows prepared by the indirect method, the Cash flows from operating activities section would include

Baxter Company reported a net loss of $13,000 for the year ended December 31. During the year, accounts receivable decreased by $5,000, merchandise inventory increased by $8,000, accounts payable increased by $10,000, and depreciation expense of $4,000 was recorded. During the year, operating activities under the indirect method

Which of the following types of transactions would be reported as a cash flow from investing activity on the statement of cash flows?

The net income reported on an income statement for the current year was $63,000. Depreciation recorded on fixed assets for the year was $24,000. Balances of the current asset and current liability accounts at the end and beginning of the year are listed below. Prepare the Cash flows from operating activities section of the statement of cash flows using the indirect method.​

Each of the events below may have an effect on the statement of cash flows. Designate how the event should be reported within the statement of cash flows using the codes provided. Codes may be used more than once, or not at all.Codes: I +Investing activity; cash inflow I -Investing activity; cash outflow F +Financing activity; cash inflow F -Financing activity; cash outflow O +Operating activity; cash inflow O -Operating activity; cash outflow NCNoncash investing and financing activity? Events: 1.Paid the weekly payroll 2.Paid an account payable 3.Issued bonds payable for cash 4.Declared and paid a cash dividend 5.Paid cash for a new piece of equipment 6.Purchased treasury stock for cash 7.Paid cash for stock in another company 8.Recorded depreciation 9.Received cash for sales 10.Sold a long-term stock investment for cash at book value

For each of the following activities that may take place during the accounting period, indicate the effect (a-g) on the statement of cash flows prepared using the indirect method. Choices may be selected as the answer for more than one question. -Repayment of long-term note payable

The statement of cash flows is an optional financial statement.