ACCN 2010 Chapter 12 Quiz

ACCN 2010 Chapter 12 Quiz | Tulane University

Question 1

If accounts receivable have increased during the period 

expenses on an accrual basis are greater than expenses on a cash basis.

revenues on an accrual basis are the same as revenues on a cash basis.

revenues on an accrual basis are less than revenues on a cash basis.

revenues on an accrual basis are greater than revenues on a cash basis.

 

Question 2

Which one of the following affects cash during a period? 

Recording depreciation expense.

Payment of accounts payable.  

Write-off of an uncollectible account receivable.

Declaration of a cash dividend.

 

Question 3

Pharoah Company reported net income of $412000 for the year. During the year, accounts receivable increased by $30000, accounts payable decreased by $13000 and depreciation expense of $64000 was recorded. Net cash provided by operating activities for the year is 

$391000.

$412000.

$433000.  

$365000.

 

Question 4

Which of the following would be subtracted from net income using the indirect method? 

Depreciation expense.

A decrease in prepaid expenses.

An increase in accounts payable.

An increase in accounts receivable.

Question 5

Vaughn Manufacturing reported a net loss of $15300 for the year ended December 31, 2022. During the year, accounts receivable decreased $7650, inventory increased $12240, accounts payable increased by $15300, and depreciation expense of $9180 was recorded. During 2022, operating activities

provided net cash of $4590.  

used net cash of $10710.

provided net cash of $10710.

used net cash of $4590.

 

Question 6

Using the indirect method, which of the following adjustments to convert net income to net cash provided by operating activities is correct?

                                Add to Net Income         Deduct from Net Income

 

Prepaid Expenses            increase               decrease

 

Inventory            decrease             increase

 

Accounts Receivable      increase               decrease

 

Taxes Payable   decrease             increase

 

Question 7

The net income reported on the income statement of Metlock, Inc. for the current year was $1224000. Depreciation recorded on plant assets was $231000. Accounts receivable and inventories increased by $65000 and $43000, respectively. Prepaid expenses and accounts payable decreased by $5000 and $59000, respectively. How much cash was provided by operating activities during the year? 

$1242000.

$1350000.

$1293000.  

$1617000.

 

Question 8

In preparing the statement of cash flows, determining the net increase or decrease in cash requires the use of 

the current period's retained earnings statement.

the adjusted trial balance.

a comparative income statement.  

a comparative balance sheet. 

 

Question 9

In addition to the three basic financial statements, which of the following is also a required financial statement? 

The Cash Reconciliation.

Statement of Cash Flows.  

The Cash Budget.

Statement of Cash Inflows and Outflows.

 

Question 10

The acquisition of land by issuing common stock is 

a noncash transaction and would be reported in the body of a statement of cash flows.

a cash transaction and would be reported in the body of a statement of cash flows.

a noncash transaction that is not reported in the body of a statement of cash flows.  

only reported if the statement of cash flows is prepared using the direct method.

 

Question 11

The payment of a cash dividend would be classified as a(n) 

significant noncash activity.

financing activity.

investing activity.

operating activity.

Question 12

Nash's Trading Post, LLC issued common stock for proceeds of $413000 during 2022. The company paid dividends of $73000 and issued a long-term note payable for $278000 in exchange for equipment during the year. The company also purchased treasury stock that had a cost of $60000. The financing section of the statement of cash flows will report net cash inflows of 

$618000.

$280000.  

$340000.

$558000.

 

Question 13

Nash's Trading Post, LLC issued common stock for proceeds of $413000 during 2022. The company paid dividends of $73000 and issued a long-term note payable for $278000 in exchange for equipment during the year. The company also purchased treasury stock that had a cost of $60000. The financing section of the statement of cash flows will report net cash inflows of 

$618000.

$280000.  

$340000.

$558000.