Question 4 An entity purchased a building and paid partly in equity shares and partly in debentures. The transaction shall be treated as which of the following? A The purchase of the building is investing and the issuance of shares and debentures is financing. (B) The purchase of the building is investing and the issuance of shares and debentures is not reported. с The transaction shall be disclosed only in the notes. The transaction shall be ignored totally. Question 5 The statement of cash flows reports all, except: (A) the net change in cash for the period (B) the cash flows from operations during the period C the free cash flow generated during the period (D) investing transactions Question 6 An entity that changed from cash basis to accrual basis of accounting during the current year should report: A prior period adjustment resulting from the correction of an error. prior period adjustment resulting from the change in accounting policy. (C) component of income from continuing operations. D) component of income from discontinued operations.
Question 4 An entity purchased a building and paid partly in equity shares and partly in debentures. The transaction shall be treated as which of the following? A The purchase of the building is investing and the issuance of shares and debentures is financing. (B) The purchase of the building is investing and the issuance of shares and debentures is not reported. с The transaction shall be disclosed only in the notes. The transaction shall be ignored totally. Question 5 The statement of cash flows reports all, except: (A) the net change in cash for the period (B) the cash flows from operations during the period C the free cash flow generated during the period (D) investing transactions Question 6 An entity that changed from cash basis to accrual basis of accounting during the current year should report: A prior period adjustment resulting from the correction of an error. prior period adjustment resulting from the change in accounting policy. (C) component of income from continuing operations. D) component of income from discontinued operations.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Kindly provide the correct answers for the following items.
Transcribed Image Text:Question 4
An entity purchased a building and paid partly in equity shares and partly in debentures. The transaction shall be treated as which of the following?
A The purchase of the building is investing and the issuance of shares and debentures is financing.
(B) The purchase of the building is investing and the issuance of shares and debentures is not reported.
с The transaction shall be disclosed only in the notes.
The transaction shall be ignored totally.
Question 5
The statement of cash flows reports all, except:
(A) the net change in cash for the period
B) the cash flows from operations during the period
C the free cash flow generated during the period
D) investing transactions
Question 6
An entity that changed from cash basis to accrual basis of accounting during the current year should report:
A prior period adjustment resulting from the correction of an error.
prior period adjustment resulting from the change in accounting policy.
(C) component of income from continuing operations.
(D) component of income from discontinued operations.
Transcribed Image Text:Question 1
Interest received and dividend received may be classified alternatively as cash flow from:
A operating activities
B investing activities
financing activities
(D) lending activities
Question 2
In a statement of cash flows, which of the following should be reported as cash flow from financing activities?
A payment to retire mortgage note
B interest payment on mortgage note
dividend payment
D payment to retire mortgage note and dividend payment
Question 3
Making and collecting loans are:
A operating activities
B) investing activities
financing activities
D liquidity activities
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