Question Details

When listing accounts in the statement of cash flows 



1.	LF- Pest Control Products has the following information available:
Net Income	$25,000
Cash Provided by Operations	31,000
Cash Sales	65,000
Capital Expenditures	11,000
Dividends Paid	3,000
What is LF- free cash flow?
a.	$28,000
b.	$20,000 
c.	$17,000 
d.	$11,000

2.	During 2011, Klugman Industries reported cash provided by operations of €690,000, cash used in investing of €1,029,000, and cash used in financing of €135,000. In addition, cash spent for fixed assets during the period was €414,000. No dividends were paid. Based on this information, what was Klugman's free cash flow?
a.	(€339,000)
b.	€1,440,000
c.	€276,000
d.	(€888,000)


	3.	All of the following statements about free cash flow are false except:
a.	Significant free cash flow indicates less potential to finance new investments.
b.	Free cash flow is most commonly calculated by subtracting capital expenditures from cash provided by operations and then adding cash dividends.
c.	Free cash flow is not reported on the statement of cash flows.
d.	Significant free cash flow indicates less potential to pay additional dividends.


4.	In the Green Company, the beginning and ending balances in Land were $198,000 and $240,000 respectively. During the year, land costing $45,000 was sold for $45,000 cash, and land costing $87,000 was purchased for cash. The entries in the reconciling columns of the worksheet will include a:
a.	credit to Land $45,000 and a debit to Sale of Land $45,000 under investing activities.
b.	debit to Land $87,000 and a credit to Purchase of Land $87,000 under financing activities.
c.	net debit to Land $42,000 and a credit to Purchase of Land $42,000 under investing activities.
d.	credit to Land $45,000 and a debit to Sale of Land $45,000 under financing activities.


	5.	When listing accounts in the statement of cash flows worksheet, the accumulated depreciation account is shown
a.	with accounts that have credit balances.
b.	with accounts that have debit balances.
c.	as a credit under the reconciling items.
d.	as a debit under the reconciling items.





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