Financial Accounting
9th Edition
ISBN: 9781259738692
Author: Libby
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 12, Problem 12.20E
1.
To determine
Show the information that should be reported on the statement of
2.
To determine
Explain the way these transactions effect the capital acquisitions ratio and to find out the way these transactions distort one’s interpretation of the ratio.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
vaibhav
subject-Accounting
Trident Corporation had the following cash flows in the current year. Which of the following will be categorized under the financing
activities section of the statement of cash flows?
O Purchase of $125,000 worth of five-year bonds issued by Towson Utilities
O Rent on a warehouse amounting to $1.1 million
O Lease income received on a piece of land
O Preferred dividends of $330,000 paid to shareholders
Assume a company’s balance sheet showed beginning and ending balances in the Long-Term Investments account of $1,100,000 and $900,000, respectively. The company sold a long-term investment that cost $300,000 and recorded a gain on this sale of $35,000. Based solely on the information provided, the company’s net cash provided by (used in) investing activities would be:
Multiple Choice
$200,000.
$300,000.
$235,000.
$335,000.
Chapter 12 Solutions
Financial Accounting
Ch. 12 - Prob. 1QCh. 12 - Prob. 2QCh. 12 - Prob. 3QCh. 12 - What are the major categories of business...Ch. 12 - Prob. 5QCh. 12 - Prob. 6QCh. 12 - Prob. 7QCh. 12 - Prob. 8QCh. 12 - Compare the two methods of reporting cash flows...Ch. 12 - Prob. 10Q
Ch. 12 - Prob. 11QCh. 12 - What are noncash investing and financing...Ch. 12 - Prob. 13QCh. 12 - Prob. 1MCQCh. 12 - Prob. 2MCQCh. 12 - Prob. 3MCQCh. 12 - Prob. 4MCQCh. 12 - Prob. 5MCQCh. 12 - Prob. 6MCQCh. 12 - Prob. 7MCQCh. 12 - Prob. 8MCQCh. 12 - Prob. 9MCQCh. 12 - Prob. 10MCQCh. 12 - Prob. 12.1MECh. 12 - Determining the Effects of Account Changes on Cash...Ch. 12 - Prob. 12.3MECh. 12 - Prob. 12.4MECh. 12 - Prob. 12.5MECh. 12 - Prob. 12.6MECh. 12 - Prob. 12.7MECh. 12 - Prob. 12.1ECh. 12 - Prob. 12.2ECh. 12 - Prob. 12.3ECh. 12 - Prob. 12.4ECh. 12 - Prob. 12.5ECh. 12 - Prob. 12.6ECh. 12 - Prob. 12.7ECh. 12 - Reporting and Interpreting Cash Flows from...Ch. 12 - Prob. 12.9ECh. 12 - Prob. 12.10ECh. 12 - Prob. 12.11ECh. 12 - Inferring Balance Sheet Changes from the Cash Flow...Ch. 12 - (Chapter Supplement B) Computing and Reporting...Ch. 12 - During the period, Sanchez Company sold some...Ch. 12 - Prob. 12.15ECh. 12 - Prob. 12.16ECh. 12 - Prob. 12.17ECh. 12 - Prob. 12.18ECh. 12 - Prob. 12.19ECh. 12 - Prob. 12.20ECh. 12 - Prob. 12.21ECh. 12 - (Chapter Supplement A) Reporting and Interpreting...Ch. 12 - Prob. 12.23ECh. 12 - Prob. 12.24ECh. 12 - Prob. 12.1PCh. 12 - Prob. 12.2PCh. 12 - Prob. 12.3PCh. 12 - Prob. 12.4PCh. 12 - Prob. 12.5PCh. 12 - (Chapter Supplement C) Preparing a Statement of...Ch. 12 - Prob. 12.1APCh. 12 - Prob. 12.2APCh. 12 - Prob. 12.3APCh. 12 - Prob. 12.1CONCh. 12 - Prob. 12.1CPCh. 12 - Prob. 12.2CPCh. 12 - Prob. 12.3CPCh. 12 - Prob. 12.4CPCh. 12 - Prob. 12.5CPCh. 12 - Prob. 12.6CP
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- During 20X1, Craig Company had the following transactions: a. Purchased 300,000 of 10-year bonds issued by Makenzie Inc. b. Acquired land valued at 105,000 in exchange for machinery. c. Sold equipment with original cost of 810,000 for 495,000; accumulated depreciation taken on the equipment to the point of sale was 270,000. d. Purchased new machinery for 180,000. e. Purchased common stock in Lemmons Company for 82,500. Required: 1. Prepare the net cash from investing activities section of the statement of cash flows. 2. CONCEPTUAL CONNECTION Usually, the net cash from investing activities is negative. How can Craig cover this negative cash flow? What other information would you like to have to make this decision?arrow_forwardFour years ago, Sulu Corporation purchased a $75,000 long-term investment in bonds of another corporation. During the current year, this investment was sold for $80,000. Sulu uses the indirect method to prepare its statement of cash flows. What effect will the above transaction have on the investing activities section of Sulu's statement of cash flows for the current year? a.$75,000 increase b.$80,000 increase c.$5,000 increase d.$5,000 decreasearrow_forwardCash Flow from Investing Activities During 20X1, Sanchez Company had the following transactions: Sold $199,500 of 10-year bonds issued by Makenzie Inc. Acquired land valued at $69,600 in exchange for machinery. Sold equipment with original cost of $539,900 for $330,600; accumulated depreciation taken on the equipment to the point of sale was $180,500. Purchased new machinery for $120,800. Sold common stock in Lemmons Company for $54,600. Required: Question Content Area 1. Prepare the net cash from investing activities section of the statement of cash flows. (Note: Use a minus sign to indicate any decreases in cash or cash outflows.) Sanchez CompanyStatement of Cash Flows (Partial)Year Ending December 31, 20X1 Line Item Description Amount Cash flows from investing activities: Net cash from investing activities Land in exchange for machinery Purchase of new machinery Land in exchange for machinery $Sale of bonds Noncash investing activity:…arrow_forward
- 33. An entity had the following activities during the current year: Acquired share capital of another entity 2,000,000 Sold an investment with carrying amount of P2,000,000 1,500,000 Acquired a one-year certificate of deposit from a bank 5,000,000 Interest on the deposit received from the bank 500,000 Collected dividends on share investments 300,000 What amount should be reported as net cash used in investing activities? a. 5,500,000 b. 5,000,000 c. 4,700,000 d. 6,300,000arrow_forwardShow stepsarrow_forwardBalance sheets for Brierwold Corporation follow: Additional transactions were as follows: a. Purchased equipment costing 50,000. b. Sold equipment costing 60,000, with a book value of 25,000, for 40,000. c. Retired preferred stock at a cost of 110,000. (The premium is debited to Retained Earnings.) d. Issued 10,000 shares of common stock (par value, 4) for 10 per share. e. Reported a loss of 15,000 for the year. f. Purchased land for 50,000. Required: Prepare a statement of cash flows using the worksheet approach. Use the indirect method to prepare the statement.arrow_forward
- Balance sheets for Brierwold Corporation follow: Additional transactions were as follows: a. Purchased equipment costing 50,000. b. Sold equipment costing 60,000, with a book value of 25,000, for 40,000. c. Retired preferred stock at a cost of 110,000. (The premium is debited to Retained Earnings.) d. Issued 10,000 shares of common stock (par value, 4) for 10 per share. e. Reported a loss of 15,000 for the year. f. Purchased land for 50,000. Required: Prepare a statement of cash flows using the indirect method.arrow_forwardCarter Containers sold marketable equity securities, land, and common stock for $40.0 million, $13.5 million, and $35.0 million, respectively. Carter also purchased treasury stock, equipment, and a patent for $10.0 million, $22.5 million, and $14.6 million, respectively.Required: What amount should Carter report as net cash from financing activities?arrow_forwardVikarrow_forward
- WHAT IS THE NET CASH PROVIDED BY FINANCING ACTIVITIES?arrow_forwardPlease Do not Give image format and Details solutionarrow_forwardFollowing information of Beta Inc are as follows: Purchase of a machinery(Plant asset)=280,000 Proceeds from land sale=300,000 Proceeds from issuance of common shares=300,000 Proceeds from long term borrowings=400,000 Inventory purchases=850,000 Find the cash provided by investing activities for the year as per cash flow statement.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning
Intermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...
Accounting
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning