rom the Statement of cash flows problem on pages 4-7 and 4-8…which of the following is not an operating cash flow? Group of answer choices A. Receive cash from a customer B. Provided services on account C. Pay for rent D. Pay interest on loan
rom the Statement of cash flows problem on pages 4-7 and 4-8…which of the following is not an operating cash flow? Group of answer choices A. Receive cash from a customer B. Provided services on account C. Pay for rent D. Pay interest on loan
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
From the Statement of cash flows problem on pages 4-7 and 4-8…which of the following is not an operating cash flow?
Group of answer choices
A. Receive cash from a customer
B. Provided services on account
C. Pay for rent
D. Pay interest on loan
![TR Company
Statement of Cash Flows
For the year ending December 31, this year
Cash Flows from Operating Activities
Cash inflows:
Cash outflows:
Net cash flows from operating activities
Cash Flows from Investing Activities
Net cash flows from investing activities
Cash Flows from Financing Activities
Net cash flows from financing activities
Net change in cash
Cash at the beginning of the year
Cash at the end of the year
Practice
During the year, a company issues common stock for $60,000 and
repays previously borrowed amounts of $100,000. In addition, the
company pays dividends of $8,000 to stockholders, pays the
manager a salary of $52,000, pays landlord rent of $14,000 and
pays interest of $500 to creditors, sells old equipment for $15,000
and land for $40,000. Determine the amount of financing cash
flows the company would report in the current year.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F29a30a17-e1e8-4464-bead-6b6d3758eacb%2F5f2aa3c7-76b3-4db5-bc15-68387b424c9e%2F74lzsje_processed.jpeg&w=3840&q=75)
Transcribed Image Text:TR Company
Statement of Cash Flows
For the year ending December 31, this year
Cash Flows from Operating Activities
Cash inflows:
Cash outflows:
Net cash flows from operating activities
Cash Flows from Investing Activities
Net cash flows from investing activities
Cash Flows from Financing Activities
Net cash flows from financing activities
Net change in cash
Cash at the beginning of the year
Cash at the end of the year
Practice
During the year, a company issues common stock for $60,000 and
repays previously borrowed amounts of $100,000. In addition, the
company pays dividends of $8,000 to stockholders, pays the
manager a salary of $52,000, pays landlord rent of $14,000 and
pays interest of $500 to creditors, sells old equipment for $15,000
and land for $40,000. Determine the amount of financing cash
flows the company would report in the current year.
![Petty cash fund: money kept on hand for making minor cash
purchases. The account is replenished when necessary. Receipts
are kept with the petty cash fund so expenses can be recognized
periodically.
Petty Cash Imprest system is often used to account for petty cash
(this is different from what the book shows). With an imprest
system, petty cash is only debited once for the original fund
amount and never credited; instead the cash account is credited for
the replenishment.
PART C: Statement of Cash Flows and Chapter 11 Part
A:Formatting the Statement of Cash Flows
Direct method
Indirect method-starts with net income and makes adjustments to
cash flows from operating activities.
Operating activitiesà
relate to items on the income statement
in which cash has been received or paid
(including interest). Also relate to changes in
current assets and current liabilities based on
payment or receipt of cash.
Investing activitiesà
cash paid or received from the purchase
or sale of long term assets.
Financing activitiesà
cash received (paid) to raise money for
the company or finance the business. Does NOT
include interest paid. Includes any cash flows
to/from owners (stockholders).
Of the three activities above, which activity would you expect a
company to show “positive cash flows" consistently over time?
The final amount shown on the statement of cash flows should
reconcile with the cash shown on the balance sheet.
Practice
Name the Cash Flow activity Operating, Investing, Financing for
each item; use ( ) for cash outflow. If no cash flow put NONE.
Complete the statement of cash flows.
TR Company had the following transactions this year. Their Cash Flow Activity
beginning cash balance was $75,000,
Sell common stock to investors for $50,000
Use () if outflow
Receive cash from customers for $100,000
Pay for rent for $25,000
Borrowed $200,000 from the bank
Purchase a $250,000 building with cash
Sold truck used in the business for $10,000
Paid $5,000 dividend to stockholders
Provided $30,000 of services to customers on account
Bought $200 of supplies on credit
Pay $3,000 interest on loan
Paid $55,000 to employee for salary](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F29a30a17-e1e8-4464-bead-6b6d3758eacb%2F5f2aa3c7-76b3-4db5-bc15-68387b424c9e%2Fj5118a_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Petty cash fund: money kept on hand for making minor cash
purchases. The account is replenished when necessary. Receipts
are kept with the petty cash fund so expenses can be recognized
periodically.
Petty Cash Imprest system is often used to account for petty cash
(this is different from what the book shows). With an imprest
system, petty cash is only debited once for the original fund
amount and never credited; instead the cash account is credited for
the replenishment.
PART C: Statement of Cash Flows and Chapter 11 Part
A:Formatting the Statement of Cash Flows
Direct method
Indirect method-starts with net income and makes adjustments to
cash flows from operating activities.
Operating activitiesà
relate to items on the income statement
in which cash has been received or paid
(including interest). Also relate to changes in
current assets and current liabilities based on
payment or receipt of cash.
Investing activitiesà
cash paid or received from the purchase
or sale of long term assets.
Financing activitiesà
cash received (paid) to raise money for
the company or finance the business. Does NOT
include interest paid. Includes any cash flows
to/from owners (stockholders).
Of the three activities above, which activity would you expect a
company to show “positive cash flows" consistently over time?
The final amount shown on the statement of cash flows should
reconcile with the cash shown on the balance sheet.
Practice
Name the Cash Flow activity Operating, Investing, Financing for
each item; use ( ) for cash outflow. If no cash flow put NONE.
Complete the statement of cash flows.
TR Company had the following transactions this year. Their Cash Flow Activity
beginning cash balance was $75,000,
Sell common stock to investors for $50,000
Use () if outflow
Receive cash from customers for $100,000
Pay for rent for $25,000
Borrowed $200,000 from the bank
Purchase a $250,000 building with cash
Sold truck used in the business for $10,000
Paid $5,000 dividend to stockholders
Provided $30,000 of services to customers on account
Bought $200 of supplies on credit
Pay $3,000 interest on loan
Paid $55,000 to employee for salary
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