ch21 - ch21 Student: _ 1. Amounts held in cash equivalent...

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ch21 Student: ___________________________________________________________________________ 1. Amounts held in cash equivalent investments must be reported separately from amounts held as cash in the statement of cash flows. True False 2. If the direct method is used to report cash flows from operating activities in the body of the statement of cash flows, a reconciliation of net income to net cash flows from operating activities also is required. True False 3. Cash paid for taxes and interest must be disclosed on the face of the statement or in the disclosure notes under both the direct and indirect methods of reporting cash flows from operating activities. True False 4. Generally speaking, cash flows from operating activities include the elements of net income reported on a cash basis. True False 5. A decrease in cash dividends payable means that dividends declared were less than dividends paid. True False 6. The purchase of treasury stock is an investing cash outflow. True False 7. Interest payments on debt are classified as cash outflows from financing activities. True False 8. Transactions that represent noncash investing and financing activities must be reported in the statement of cash flows or in disclosure notes. True False 9. In using a spreadsheet to prepare the statement of cash flows, the summary entries duplicate the actual journal entries used to record the transactions during the year. True False 10. When one enters a $50,000 credit entry to the Land account in a spreadsheet for the statement of cash flows, it represents a negative change in that account and probably is due to selling such assets. True False 11. Listed below are the reporting classifications for a statement of cash flows using the direct method for reporting operating cash flows. Indicate the reporting classification that would apply to each of the five transactions described below by placing the letter of the reporting classification in the space provided by each transaction. 1. Operating cash inflow Interest received on cash savings account. ___ _ 2. Not reported for the statement of cash flows Cash purchase of inventory. ___ _ 3. Operating cash outflow Cash dividends received under the equity method. ___ _ 4. Financing cash outflow Principal payment on a note. ___ _ 5. Operating cash inflow Distribution of a stock dividend. ___ _
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12. Listed below are the reporting classifications for a statement of cash flows using the direct method for reporting operating cash flows. Indicate the reporting classification that would apply to each of the five transactions described below by placing the letter of the reporting classification in the space provided by each transaction. 1. Operating cash inflow
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This note was uploaded on 04/12/2011 for the course ACCT 201 taught by Professor Hyduke,n during the Spring '10 term at Community College of Baltimore County.

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ch21 - ch21 Student: _ 1. Amounts held in cash equivalent...

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