Question Details

In the bottom portion of the statement of cash flows 



1.	Which of the following would not appear in the operating activities section of a statement of cash flows prepared under the direct method?
a.	Cash receipts from customers
b.	Cash paid for income taxes
c.	Gain on sale of equipment
d.	Cash paid to employees

2.	In the Garnet Company, the beginning and ending balances in Land were $198,000 and $240,000 respectively. During the year, land costing $50,000 was sold for $50,000 cash, and land costing $92,000 was purchased for cash. The entries in the reconciling columns of the worksheet will include a:
a.	credit to Land $50,000 and a debit to Sale of Land $50,000 under investing activities.
b.	debit to Land $92,000 and a credit to Purchase of Land $92,000 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 $50,000 and a debit to Sale of Land $50,000 under financing activities.

3.	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.

	4.	In the bottom portion of the statement of cash flows worksheet,
a.	inflows of cash are debits in the reconciling columns.
b.	outflows of cash are debits in the reconciling columns.
c.	information pertaining to investing and financing activities only is entered.
d.	only significant noncash transactions are entered.


	5.	On the statement of cash flows worksheet,
a.	significant noncash investing and financing activities are not entered in the reconciling columns.
b.	a decrease in cash will be offset by a debit in the reconciling items columns at the bottom of the worksheet.
c.	an increase in cash will be offset by a debit in the reconciling items column at the bottom of the worksheet.
d.	income statement accounts are listed after balance sheet accounts in the top half of the worksheet under the indirect method.





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