Identify Each of the Following as Increasing (+) or Decreasing

question 84

Essay

Identify each of the following as increasing (+) or decreasing (-) cash flows from operating activities (O), investment activities (I), or financing activities (F). (EXAMPLE: the sale of plant and equipment would increase cash flows from investing activities, and the correct answer would be +I).
_______ 1. Increase in accounts payable
_______ 2. Decrease in inventory
_______ 3. Net income from operations
_______ 4. Payment of dividends
_______ 5. Sale of preferred stock
_______ 6. Increase in accrued expenses
_______ 7. Purchase of new equipment
_______ 8. Decrease in amortization expense
_______ 9. Increase in accounts receivable
_______ 10. Decrease in notes payable
_______ 11. Increase in net worth
_______ 12. Increase in long-term liabilities
_______ 13. Increase in investments
_______ 14. Decrease in marketable securities
_______ 15. Reduction in retained earnings
_______ 16. Repurchase of common shares outstanding
_______ 17. Increase in prepaid expense
_______ 18. Decrease in income taxes payable
_______ 19. Retirement of long-term bonds payable
_______ 20. Sale of new common stock

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Definitions:

Canada Revenue Agency

The federal agency responsible for administering tax laws for the Canadian government and for most provinces and territories.

Accumulated Depreciation

The total amount of depreciation that has been recorded against a fixed asset over its useful life, reducing its book value.

Loss of $1,000

A financial term indicating that an entity has incurred a negative financial result, specifically being $1,000 less than initially accounted for or expected.

Impairment Loss

A reduction in the book value of an asset when its fair market value falls below its carrying amount on the balance sheet, indicating a permanent decline in value.