Statement of Cash Flow Paper 4

1

Larry Mitchell, Bailey Company’s controller, is gathering data for the statement of cash flows for the most recent year end. Mitchell is planning to use the direct method to prepare this statement and has made the following list of cash inflows for the period: ? Collections of $100,000 for goods sold to customers ? Securities purchased for investment purposes with an original cost of $100,000 sold for $125,000 ? Proceeds from the issuance of additional company stock totaling $10,000 The correct amount to be shown as cash inflows from operating activities is






2

During the year, Deltech, Inc., acquired a long-term productive asset for $5,000 and also borrowed $10,000 from a local bank. These transactions should be reported on Deltech’s statement of cash flows as






3

Atwater Company has recorded the following payments for the current period:
Purchase Trillium stock........................... $300,000
Dividends paid to Atwater shareholders....... 200,000
Repurchase of Atwater Company stock........ 400,000
The amount to be shown in the investing activities section of Atwater’s statement of cash flows should be






4

Carlson Company has the following payments recorded for the current period:
Dividends paid to Carlson shareholders... $150,000
Interest paid on bank loan ......................250,000
Purchase of equipment........................... 350,000
The total amount of the above items to be shown in the operating activities section of Carlson’s statement of cash flows should be






5

Barber Company has recorded the following payments for the current period:
Interest paid on bank loan .................$300,000
Dividends paid to Barber shareholders ........................................................200,000
Repurchase of Barber stock................. 400,000
The amount to be shown in the financing activities section of Barber’s statement of cash flows should be






6

Selected financial information for Kristina Company for the year just ended is shown below.
Net income........................................ $2,000,000
Increase in net accounts receivable .........300,000
Decrease in inventory........................... 100,000
Increase in accounts payable ..................200,000
Depreciation expense .............................400,000
Gain on the sale of available-for-sale securities............................................. 700,000
Cash receivable from the issue of common stock.. ..........................................................800,000
Cash paid for dividends ..........................80,000
Cash paid for the acquisition of land....... 1,500,000
Cash received from the sale of available-for-sale securities........................................... 2,800,000
Kristina’s cash flow from financing activities for the year is






7

Selected financial information for Kristina Company for the year just ended is shown below.
Net income........................................ $2,000,000
Increase in net accounts receivable .........300,000
Decrease in inventory........................... 100,000
Increase in accounts payable ..................200,000
Depreciation expense .............................400,000
Gain on the sale of available-for-sale securities............................................. 700,000
Cash receivable from the issue of common stock.. ..........................................................800,000
Cash paid for dividends ..........................80,000
Cash paid for the acquisition of land....... 1,500,000
Cash received from the sale of available-for-sale securities........................................... 2,800,000
Kristina’s cash flow from investing activities for the year is






8

For the fiscal year just ended, Doran Electronics had the following results:
Net income....................................... $920,000
Depreciation expense......................... 110,000
Increase in accounts payable................ 45,000
Increase in net accounts receivable....... 73,000
Increase in deferred income tax liability ..16,000
Doran’s net cash flow from operating activities is






9

Three years ago, Jameson Company purchased stock in Zebra, Inc., at a cost of $100,000. This stock was sold for $150,000 during the current fiscal year. The result of this transaction should be shown in the investing activities section of Jameson’s statement of cash flows as






10

Madden Corporation’s controller has gathered the following information as a basis for preparing the statement of cash flows. Net income for the current year was $82,000. During the year, old equipment with a cost of $60,000 and a net carrying amount of $53,000 was sold for cash at a gain of $10,000. New equipment was purchased for $100,000. Shown below are selected closing balances for last year and the current year.
..................................... Last Year..... Current Year
Cash................................ $ 39,000...... $ 85,000
Accounts receivable net......... 43,000........ 37,000
Inventories ..........................93,000 ........105,000
Equipment........................... 360,000....... 400,000
Acc depreciation equipment .....70,000........ 83,000
Accounts payable.................... 22,000 ........19,000
Notes payable........................ 100,000..... 100,000
Common stock ........................250,000..... 250,000
Retained earnings ...................93,000...... 175,000
Madden’s net cash flow from operating activities for the current year is






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