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CASH PROVIDED BY OPERATING ACTIVITIES:

CASH PROVIDED BY OPERATING ACTIVITIES:

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Author: Joyce Buda
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Cash provided by operating activities:
Question 1 options:
 
may be larger than net income.

 
equals the change in cash for the year.

 
decreases when long-term debt is repaid.

 
summarizes cash flows relating to the purchase and disposal of long-lived assets.

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Question 2 (1 point)
Nancy's Cookie Shop reported equipment at $120,000 and $30,000 accumulated depreciation on its December 31, 2013, balance sheet. During 2014, the shop purchased equipment costing $30,000 and sold equipment costing $10,000 (book value $4,000) for $1,000. On December 31, 2014, net equipment was $98,000. Using the indirect method, Samantha's would report depreciation expense on its statement of cash flows for 2014 of:
Question 2 options:
 
$14,000.

 
$22,000.

 
$18,000.

 
$30,000.

Question 3 (1 point)
Short-term liquidity ratios include the:
Question 3 options:
 
acid-test ratio.

 
debt to total assets ratio.

 
profit margin ratio.

 
payout ratio.

Question 4 (1 point)
Sunshine Paint reported sales of $500,000, total assets of $300,000, total owners' equity of $160,000, current assets of $100,000, current liabilities of $40,000, and cash of $30,000. In a common-size analysis of the balance sheet, cash would be shown as:
Question 4 options:
 
10%.

 
30%.

 
50%.

 
6%.

Question 5 (1 point)
The use of common-size analysis financial statements is an example of:
Question 5 options:
 
liquidity analysis.

 
ratio analysis.

 
horizontal analysis.

 
vertical analysis.

Question 6 (1 point)
The purchase of an office building by issuing long-term notes payable should be reported as a:
Question 6 options:
 
cash outflow in the investing section of the statement of cash flows.

 
cash outflow in the financing section of the statement of cash flows.

 
noncash investing and financing activity.

 
cash outflow in the operating section of the statement of cash flows.


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