Presentation on theme: "1. Identify each of the following items as either a positive cash flow, negative cash flow, or no effect, and identify the dollar amount. Increase in Accounts."— Presentation transcript:
1 1. Identify each of the following items as either a positive cash flow, negative cash flow, or no effect, and identify the dollar amount.Increase in Accounts Receivable by $5,000- $5,000 opsIncrease in Inventory by $10,000- $10,000 opsIncrease cash revenues by $100,000+ $100,000 ops
2 More Cash Flow….. Increase cash expenses by $60,000 -$60,000 opsIncrease Accounts Paybable by $10,000+ $10,000 opsIncrease depreciation expense for tax purposes by $30,000+ $30,000
3 2. A statement of cash flows would be least useful in answering which of the following questions? A) What was the average balance in the Cash account during the period? B) Did operating activities result in a positive or negative net cash flow? C) How much cash was provided or used by financing activities during the period? D) Were cash dividends paid by the company more or less than the net cash flow from operations?
4 3. Which of the following transactions would increase the net cash flow from operating activities? A) The collection of an account receivable from a customer. B) The issuance of capital stock for cash at a price above par. C) The purchase of a delivery truck by issuing a note payable. D) The sale of equipment for cash at a gain.
5 4. Analysis of the investing activities section of the statement of cash flows will show a. any sales or repurchases of stock.b. whether the company is shrinking or growing.c. how corporate growth is being funded.d. to what extent day-to-day operations are affecting cash flow.
6 5. Which of the following transactions produces a cash outflow? a. Increasing debtb. Receipt of interest and/or dividends from loans and investmentsc. Acquisition of treasury stockd. Issuance of preferred or common stock for cash
7 6. Which of the following is not characteristic of the operating activities section of the statement of cash flows?a. Begins with net income, followed by a list of adjustmentsb. Adjusts income statement items from an accrual basis to a cash basisc. Shows total cashflowsd. Adjusts for items of expense that do not require cash outflows