An increase in the balance in Accounts Payable. This indicates which part will be affected:

An increase in the balance in Accounts Payable. This indicates which part will be affected:

a. Operating
b. Investing
c. Financing
d. Supplemental

Answer: A

An increase in the balance in a retailer's Merchandise Inventory. This indicates which part will be affected:

An increase in the balance in a retailer's Merchandise Inventory. This indicates which part will be affected:

a. Operating
b. Investing
c. Financing
d. Supplemental

Answer: A

The proceeds from the sale of the automobile. This indicates which part will be affected:

The proceeds from the sale of the automobile. This indicates which part will be affected:

a. Operating
b. Investing
c. Financing
d. Supplemental

Answer: B

Gain on the Sale of Automobile formerly used in the business; This indicates which part will be affected:

Gain on the Sale of Automobile formerly used in the business; This indicates which part will be affected:

a. Operating
b. Investing
c. Financing
d. Supplemental

Answer: A

Declaration and payment of dividends on company's stock. This indicates which part will be affected:

Declaration and payment of dividends on company's stock. This indicates which part will be affected:

a. Operating
b. Investing
c. Financing
d. Supplemental

Answer: C

The Loss on the Sale of Equipment. This indicates which part will be affected:

The Loss on the Sale of Equipment. This indicates which part will be affected:

a. Operating
b. Investing
c. Financing
d. Supplemental

Answer: A

Proceeds from the sale of equipment used in the business. This indicates which part would be effected:

Proceeds from the sale of equipment used in the business. This indicates which part would be effected:

a. Operating
b. Investing
c. Financing
d. Supplemental

Answer: B

Which group of ratios measures a firm's ability to meet short-term obligations?

Which group of ratios measures a firm's ability to meet short-term obligations?

a. Liquidity ratios.
b. Debt ratios.
c. Times interest earned
d. Profitability ratios.

Answer: A

Which group of ratios relates the financial charges of a firm to its ability to service them?

Which group of ratios relates the financial charges of a firm to its ability to service them?

a. Liquidity ratios.
b. Debt ratios.
c. Times interest earned
d. Profitability ratios.

Answer: C

Which of the following is an example of a cash outflow?

Which of the following is an example of a cash outflow?

a. Cash from collections on account
b. Cash for the principle of a loan
c. Salaries and wages payable
d. All of these

Answer: B

Which of the following is true regarding to cash flows from operating activities of the statement of cash flows (using the indirect method)?

Which of the following is true regarding to cash flows from operating activities of the statement of cash flows (using the indirect method)?

a. Depreciation expense is added
b. A loss on the sale of plant assets is added
c. A gain on the sale of plant assets is subtracted
d. All of these

Answer: D

What sources are used to gather information to prepare the statement of cash flows?

What sources are used to gather information to prepare the statement of cash flows?

a. Comparative balance sheets
b. Current income statement
c. Additional information
d. All of these

Answer: D

Which of the following would be considered a noncash activity?

Which of the following would be considered a noncash activity?

a. Purchase of a long-term asset using a long term note payable
b. Exchange of a building for stock
c. Retirement of debt by issuing stock
d. All of these

Answer: D

Which of the following is an example of a cash inflow?

Which of the following is an example of a cash inflow?

a. Cash from collections on account
b. Cash paid to lenders for interest
c. Cash paid for salaries and wages
d. All of these

Answer: A

Which of the following is an example of a cash inflow?

Which of the following is an example of a cash inflow?

a. Cash from sale
b. Cash paid to lenders for interest
c. Cash paid for salaries and wages
d. All of these

Answer: A

Which of the following is NOT a cash outflow for the firm?

Which of the following is NOT a cash outflow for the firm?

a. depreciation.
b. dividends.
c. interest payments.
d. taxes.




Answer: A

According to the Financial Accounting Standards Board (FASB), which of the following is a cash flow from a "financing" activity?

According to the Financial Accounting Standards Board (FASB), which of the following is a cash flow from a "financing" activity?

a. cash outflow to the government for taxes.
b. cash outflow to shareholders as dividends.
c. cash outflow to lenders as interest.
d. cash outflow to purchase bonds issued by another company.

Answer: B

Which of the following would be considered a cash-flow item from an "investing" activity?

Which of the following would be considered a cash-flow item from an "investing" activity?

a. cash inflow from interest income.
b. cash inflow from dividend income.
c. cash outflow to acquire fixed assets.
d. all of these

Answer: C

Purchases divided by accounts payable provides information about:

Purchases divided by accounts payable provides information about: 

a. capital structure
b. management of working capital
c. gross profit margin
d. profitability

Answer: B

A stock dividend declared in the period should be reported as which of the following?

A stock dividend declared in the period should be reported as which of the following?

a. A cash outflow from investing activities.
b. A cash outflow from financing activities.
c. A cash outflow from operating activities.
d. None of these

Answer: D