Impact of Transactions Involving Operating Assets on Statement of Cash Flows From the following list, identify each item as operating, investing, financing, or not separately reported on the statement of cash flows. (Assume the indirect method is used.) Item Section of Cash Flows Statement Purchase of land Proceeds from sale of land Gain on sale of land Purchase of equipment Depreciation expense Proceeds from sale of equipment Loss on sale of equipment Financing Investing Not separately reported Operating

Impact of Transactions Involving Operating Assets on Statement of Cash Flows From the following list, identify each item as operating, investing, financing, or not separately reported on the statement of cash flows. (Assume the indirect method is used.) Item Section of Cash Flows Statement Purchase of land Proceeds from sale of land Gain on sale of land Purchase of equipment Depreciation expense Proceeds from sale of equipment Loss on sale of equipment Financing Investing Not separately reported Operating

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Identify the cash flow activity involve when an entity sold equipment at book value Options: • Not part of cashflow • Investing • Operating • Financing
Provide a brief explanation of why depreciation of capital assets is considered in determining potential net income from an investment, but not included in determining the net cash flow of an investment.
Which of the following will be reflected in the "Cash flows from operating activities" of a Statement of Cash Flows? A) Adjustment for depreciation B) Purchase of equipment C) Increase or decrease in loans D) Purchase of inventory
The net income reported on an income statement for the current year was $63,000. Depreciation recorded on fixed assets for the year was $24,000. Balances of the current asset and current liability accounts at the end and beginning of the year are listed below. Prepare the Cash Flows from Operating Activities section of the statement of cash flows using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments. End Beginning Cash $65,000 $70,000 Accounts receivable (net) 70,000 57,000 Inventories 86,000 102,000 Prepaid expenses 4,000 4,500 Accounts payable (merchandise creditors) 51,000 58,000 Cash dividends payable 4,500 6,500 Salaries payable 6,000 7,500
In a statement of cash flows, indicate which of the following does NOT correspond to investment activities: Select one: a. Purchase of property, plant and equipment assets. b. Loan granted to company officials. c. Compensation received from the insurer for warehouse destroyed by fire. d. Sale of investments to negotiate (trading
This is an accounting question about reconciling direct-method cash flow from operations to net income. I have read that generally for a simple noninventory situation the approach would be something like: Net Income Plus depreciation Minus Change in Current Assets Plus Change in Current Liabilities --> Should equal cash flows from operations in the cash flow statement. My question is about purchasing a long-term asset on account. A journal entry is made: credit accounts payable/debit long-term asset. If I generate a cash flow statement, the increase in current liabilities caused by that entry will be a part of the equation above. But that amount is not an operating cash flow, it is an investing cash flow. So my reconciliation to operating activities will be off by that amount. It seems like there's a missing adjustment in the equation, like "Minus assets purchased on account" or something like that. Example: Say my company just started and so far only has $5K contibuted cash in the…
Which of the following would be reported in the either the operating, investing or financing sections of the statement of cash flows prepared under the indirect method? Group of answer choices Declaration of an unpaid cash dividend Acquisition of a factory warehouse by issuing long term debt Gain on the sale of equipment sold Write-off of a noncollectable account receivable
To account for cash flows from operational operations, the indirect method adds depreciation expenditure to net income. Is there an increase in cash due to depreciation?
Which of the following will be reflected in the "Cash flows from operating activities" of a Statement of Cash Flows? O A. Adjustment for depreciation O B. Purchase of equipment O C. Increase or decrease in loans O D. Purchase of inventory Previous page nttps://mancosaconnectacza/mad/ouiz/attempt.php?attempt=446654&cmid=D181433&page=18%3D Tume bere to search II
Reporting Land Transactions on Statement of Cash Flows On the basis of the details of the following fixed asset account, indicate the items to be reported on the statement of cash flows: ACCOUNT Land ACCOUNT NO. Balance Debit Credit Date Item Debit Credit Jan Balance 1 940,000 Mar. 12 Purchased for cash 310,000 1,250,000 Sold for $170,000 Oct. 4 146,000 1,104,000 Section of Statement of Item Added or Deducted Amount Cash Flows Mar. 12: Purchase of fixed asset Oct. 4: Sale of fixed asset Gain on sale of fixed asset (assume the indirect method)
Use the following income statement and information about selected current assets and current liabilities to calculate the net cash provided or used by operating activities under the indirect method. Income Statement For Year Ended December 31, Year 2 Sales Cost of goods sold Gross profit Operating expenses Wages expense Depreciation expense Rent expense Interest expense Loss on sale of land Net income $ 26,500 8,500 8,700 3,400 Accounts receivable Inventory Prepaid rent Accounts payable Wages payable Interest payable Selected beginning and ending balances of current asset and current liability accounts, all of which relate to operating activities, follow. $ 225,000 111,500 $ 113,500 $ 30,600 25,300 850 47,100 $ 66,400 5,000 $ 61,400 Balance December 31, December 31, Year 2 Year 1 $ 25,500 21,500 550 27,500 10,500 400 30,100 13,400 600
In the operating activities portion of the statement of cash flows when utilizing the indirect method, explain why depreciation expenditure, depletion expense, and amortization expense are added to net income in the operating activities section of the statement of cash flows.