1. On February 12, Addison, Inc. purchased 6,000 shares of Lucas Company at $22 per share plus a $240 brokerage fee. On August 22, Lucas paid a $0.42 dividend per share. On November 10, 4,000 shares of Lucas stock were sold for $28 per share less a $160 brokerage fee. The journal entry for the sale would include:

a. a credit to Loss on Sale for $23,680.

b. a debit to Cash for $112,000.

c. a debit to Cash for $111,840.

d. a credit to Investments for $112,000

2. The following information is available from the current period financial statements:

Net income	$ 105,227
Depreciation expense	$28,941
Increase in accounts receivable	$24,049
Decrease in accounts payable	$20,822

Determine the net cash flow from operating activities using the indirect method.

Select the correct answer.

a.

$89,297

b.

$179,039

c.

$79,513

d.

$105,227

3. Equipment with an original cost of $60,754 and accumulated depreciation of $33,117 was sold at a loss of $6,070. Find the change in cash as a result of this transaction.

Select the correct answer.

a.

decrease by $6,070

b.

increase by $21,567

c.

decrease by $33,117

d.	increase by $60,754

4. The following information is available from the current period financial statements:

Net income	$116,940
Depreciation expense	$23,960
Increase in accounts receivable	$15,492
Decrease in accounts payable	$19,962

Determine the net cash flow from operating activities using the indirect method.

Select the correct answer.

a.

$105,446

b.

$176,354

c.

$57,526

d.

$116,940

5. A building with a book value of $39,980 is sold for $61,844 cash Using the indirect method, choose how this transaction should be shown on the statement of cash flows.

Select the correct answer.

a. an increase of $39,980 from investing activities and an addition to net income of $21,864

b. an increase of $61,844 from investing activities

c.

an increase of $39,980 from investing activities

d.

an increase of $61,844 from investing activities and a deduction from net income of $21,864