Question
10) A declaration of a cash dividend is a financing activity whereas a declaration of stock dividend is ignored on a statement of cash flows.
10) A declaration of a cash dividend is a financing activity whereas a declaration of stock dividend is ignored on a statement of cash flows. (answer True or False)
11) When preparing a statement of cash flows (indirect method), an increase in prepaid expenses would result in an addition to net income. (answer True or False)
12) When using the indirect method to prepare the operating section of a statement of cash flows, a gain on the sale of equipment and a loss on impairment of an asset would both be added back as an adjustment to net income. (answer True or False)
13) A statement of cash flows typically would not disclose the effects of an exchange of a truck for machinery. (answer True or False)
14) A stock split is an example of an investing and financing activity. (answer True or False)
23) Income before taxes or taxable income can be used to compute income tax payable. (answer True or False)
24) Future taxable amounts are temporary differences that result in deferred tax liabilities. (answer True or False)
25) Deferred tax assets are the result of temporary differences that result in future deductible amounts. (answer True or False)
26) Interest from tax exempt municipal bonds cause financial accounting income to be greater than taxable income. (answer True or False)
27) Rent collected in advance is an example of a temporary difference which will give rise to a deferred tax asset. (answer True or False)
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