In Preparing a Company's Statement of Cash Flows for the Most

question 209

Multiple Choice

In preparing a company's statement of cash flows for the most recent year using the indirect method, the following information is available: $$\begin{array} { l | r } \text { Net income for the year was } & \$ 52,000 \\\hline \text { Accounts payable decreased by } & 18,000 \\\hline \text { Accounts receivable increased by } & 25,000 \\\hline \text { Inventories increased by } & 5,000 \\\hline \text { Depreciation expense was } & 30,000\end{array}$$ Net cash provided by operating activities was:

• A) $60,000.
• B) $34,000.
• C) $80,000.
• D) $52,000.
• E) $70,000.

Identify transactions that increase cash and those that decrease cash.

Analyze and calculate cash flows related to investing activities, including the sale of assets.

Determine the presentation order of activities on the Statement of Cash Flows.

Understand the reporting of cash dividends and their classification in the Statement of Cash Flows.

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Definitions:

Beneficial

Resulting in good; favorable or advantageous.

Employment Experience

The accumulated work history and skills a person gains from being employed in various jobs.

Recognitions

The act of acknowledging or awarding someone for their achievements, skills, or service, often in a formal manner.

Résumé

A document prepared by an individual that summarizes their employment history, education, skills, and accomplishments for job applications.