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Exam 6: Statements of Financial Position and Cash Flows and the Annual Report

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Question 51

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Cash flows from investing activities are ________.

A) $(3,250)
B) $(4,450)
C) $(4,750)
D) $(5,000)

E) C) and D)
F) None of the above

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Question 52

Multiple Choice

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Which of the following is not considered a financing activity when preparing the statement of cash flows?

A) issuance of common stock
B) redemption of bonds payable
C) payment of dividends
D) payments on notes receivable

E) A) and B)
F) A) and D)

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Question 53

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If an entity can borrow funds to meet an unexpected financial crisis,it exhibits high ________.

When preparing a the operating section of the statement of cash flows using the indirect method,which of the following items are added to net income?

Which of the following is a current asset?

The balance sheet reflects the financial position of an entity over a period of time.

When preparing the operating activities section of the statement of cash flows under the indirect method,depreciation expense is subtracted from net income.

Define the Dupont Analysis model and explain the relationship between its components.

Define the term subsequent event,explain the two types of subsequent events and provide an example of each.

The FASB prefers the indirect method of preparing the operating activities section of the statement of cash flows.

Presented below are the December 31 financial statements for Phillips Corporation (in $ Millions). Cash dividends of $60,750 were paid to shareholders during Year 2. Prepare a statement of cash flows using the direct method.

There is a direct relationship between a company's interest coverage ratio and degree of solvency.

The most common auditor's opinion issued on financial statements is a(n) ________.

When preparing the operating activities section of the statement of cash flows under the indirect method,gains on sale of equipment are subtracted from net income.

When preparing a balance sheet using IFRS,a company may choose to list noncurrent assets first.

Degree of solvency refers to ________.

A company reporting under IFRS may list its assets in either increasing or decreasing order of liquidity.

Financial statements issued under IFRS require additional disclosures relating to executive compensation for related-party transactions.

When using the indirect method of preparing the statement of cash flows,an increase in accounts payable should be treated as ________.

All of the following activities are classified as operating activities on a statement of cash flows except ________.