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Question 1
Use the following to answer questions 1-4:
The financial statements of Wines, Inc., provide the following information for the current year
12-31 jan 1
Accounts Receivable
10,000
180,000
Inventory
200,000
190,000
Prepaid Expenses
14,000
10,000
Accts Pay for mdse
176,000
161,000
Accrued Expenses Payable
13,000
19,000
Net Sales
2,900,000
COGS
1,500,000
Oper Expenses incl depreciation of $40,000
300,000
1.
Refer to the above data. Compute the amount of cash
1. Refer to the above data. Compute the amount of cash received from customers during the current year.
NET SALES LESS INCREASE IN ACCTS REC.
Answer
1.
1.
1. A)
$2,900,000. 1. 1. 1. B)
$2,690,000.1. 1. 1. C)
$2,870,000. 1. 1. 1. D)
Some other amount.
.
2.144 points
Question 2
1. 2. Refer to the above data. Compute the amount of Wine’s cash payments for purchases of merchandise during the current year.
A) 1,500,000
B) 1,495,000
C) 1,505,000
D) Other Amount
D)
D)2.144 points
Question 3
1.
1. 3. Refer to the above data. Compute the amount of Wine’s cash payments for operating expenses.
1.
1.
1.
1.Answer
1. A) $260,000.
1. B) $270,000
1. C) $250,000.
1. 1. 1. D) Some other amount
.
.
2.144 points
Question 4
1.
1. 4. Refer to the above data. Wine’s net cash flow from operating activities for the current year is:
1.
1.
1.
1. 1.1.Answer
|
1. A) $1,105,000. |
|||
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1. B) $1,375,000. |
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1. C) $1,495,000. |
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1. D) Some other amount. |
.
Question 5
1.
1. Use the following to answer questions 5-8:
1.
1.An analysis of Elmont Corporation’s Investment in Marketable Securities account during 2005 disclosed the following:
1.
Debit entries
$150,000
Credit entries $230,000
.
Elmont’s 2005 income statement included a $30,000 gain on sale of marketable securities and $20,000 dividend income from marketable securities. All payments and proceeds relating to marketable securities transactions were in cash.
5. Refer to the above data. The amount of cash paid by Elmont Corporation in 2005 for the purchase of marketable securities was:
A)
230,000
B) 150,000
C) 180,000
D)
190,000
D)
D) 6. Refer to the above data. The cash proceeds received by Elmont Corporation in 2005 for the sale of marketable securities was:
E)
A) 150,000
F)
B)
200,000
G)
C) 230,000
H)
D) 260,000
.
2.144 points
Question 7
1.
1. 7. Refer to the above data. How should the transactions involving marketable securities be classified in Elmont’s statement of cash flows for 2005?
1.1. 1. 1.1.Answer
|
1. A) The purchase of marketable securities, sales of marketable securities, and receipt of dividends are all classified as investing activities. |
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1. B) The purchase and the sale of marketable securities are classified as investing activities; the receipt of dividends is classified as an operating activity. |
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1. C) The purchase of marketable securities is classified as an investing activity; the sale of marketable securities is classified as a financing activity; the receipt of dividends is classified as an operating activity. |
|
1. D) The purchase and the sale of marketable securities are classified as investing activities; the receipt of dividends is classified as a financing activity. |
.2.144 points
Question 8
1.
1. 8. Refer to the above data. Based solely on the above information, Elmont’s net cash flow from investing activities for 2005 is:
1.
2.
2. A) $80,000 net cash used by investing activities
3.
B) $80,000 net cash provided by investing activities
4.
C) $110,000 net cash provided by investing activities
5.
D) $230,000 net cash provided by investing activities
5.
5. .
2.144 points
Question 9
1.
1. Use the following to answer questions 9-12:
1.1.1.
1.An analysis of changes in selected balance sheet accounts of Gotham Corporation shows the following for the current year:
1.
2. Plant and Equipment accounts
Debit entries to asset accounts =
210,000
Credit entries to asset accounts = 320,000
Debit entries to accumulated depreciation accounts
(resulting from sale of plant assets) = 30,000
Credit entries to accumulated depreciation accounts
(representing depreciation for the current year = 80,000
Gotham’s income statement for the current year includes a $4,000 gain on disposal of plant assets. All payments and proceeds relating to purchase or sale of plant assets were in cash.
9. Refer to the above data. The amount of cash paid by Gotham to acquire plant assets during the current year was:
A) $130,000 B) $210,000 C) $320,000 D) Some other amount
.
Question 10
1.
1. 10. Refer to the above data. Total cash proceeds received by Gotham from sales of plant assets during the current year amounted to:
2. A) $324,000 B) $294,000
C) $316,000
D) Some other amount
2.
2. Question 11
1.
1. 11. Refer to the above data. How should purchases, sales, and depreciation of plant assets be classified in Gotham’s statement of cash flows for the current year? (Assume the direct method is used by Gotham.)
1.
1.
1.1.Answer
|
1. A) Purchases of plant assets are classified as investing activities; sales of plant assets are classified as financing activities; depreciation is classified as an operating activity. |
|
1. B) Purchases of plant assets and depreciation are classified as investing activities; sales of plant assets are classified as financing activities. |
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1. C) Purchases and sales of plant assets are classified as investing activities; depreciation does not appear as an operating, financing, or investing activity. |
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1. D) Since plant assets are used to generate income from operations, purchases, sales, and depreciation of plant assets are all classified as operating activities. |
. 2.144 points
Question 12
1.
1. 12. Refer to the above data. Based solely on the data provided above, Gotham’s net cash flow from investing activities for the current year is:
1.Answer
|
1. A) $110,000 net cash provided by investing activities. |
|
1. B) $110,000 net cash used by investing activities. |
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1. C) $84,000 net cash provided by investing activities. |
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1. D) $504,000 net cash provided by investing activities. |
. 2.144 points
Question 13
1.
1. Use the following to answer questions 13-15:
1.1.1.
1.During 2006, the cash flows related to Dodge Data, Inc.’s lending and borrowing activities are summarized as follows:
1.Invest Oper Finan
|
1. Cash lent to borrowersLESS |
1. $85,000 |
|
1. Payment to retire(LESS) bonds payable. 2. 2. |
1. 175,000 |
|
1. Proceeds from borrowing at bank (note payable)……………….. 1. |
1. 105,000 |
|
1. Interest received from borrowers……………………………………. 1. |
1. 15,000 |
|
1. Interest payments made on bonds payable.LESS……………………….. 1. |
1. 20,000 |
.
13. Refer to the above data. On the basis of the above information alone, what is Dodge Data’s net cash flow from financing activities?
Answer
|
1. A) $70,000 net cash used for financing activities. |
|
1. B) $260,000 net cash used for financing activities. |
|
1. C) $155,000 net cash used for financing activities. |
|
1. D) $245,000 net cash used for financing activities. |
.
2.144 points
Question 14
1.
1. 14. Refer to the above data. If Dodge Data’s income statement for 2006 reports interest expense of $12,000, then:
1.1.
1.
1.1.1.Answer
|
1. A) Interest payable decreased by $8,000 in 2006. |
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1. B) Interest payable increased by $8,000 in 2006. |
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1. C) Interest payable at the end of 2006 amounts to $8,000. |
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1. D) Either the amount reported in the income statement or the interest payment shown above must be incorrect. |
. 2.144 points
Question 15
1.
1. 15. Refer to the above data. If interest receivable was $3,000 at December 31, 2005, and is $5,000 at the end of 2006, interest revenue reported in Dodge Data’s income statement for 2006 must have been:
1.
1.
1. 1.1. 1.1.Answer
|
1. A) $8,000. |
|
1. B) $10,000. |
|
1. C) $17,000. |
. 2.144 points
Question 16
1.
1. 16. Acme Company uses the indirect method to prepare its statement of cash flows. The following information has been gathered for the current period:
1.
2. Gain on Sale of land = $45,000
3. Net Income – 162,000
4. Depreciation Expense = 74,000
5. Cash Received from sale of land = 160,000
6.
Decrease in inventory = 10,000
7.
Increase in accounts receivable = 5,000
8.
Increase in accounts payable= 11,000
On the basis of the above information only, Acme Company’s statement of cash flows shows net cash flow from operating activities to be:
A 185,000
B 307,000
C 207,000
D 367,000
.
