10 multiple choice questions !!

1. On an indirect method statement of cashflows, the purchase of machinery in exchange for common sharesis: A.shown in the schedule of noncash investing and financing activities which accompanies the statement of cash flowsB.reflected in the operating activities sectionC.reflected in the investing activities sectionD.ignored

2. All of the following might appear on an indirect method statement of cash flows except: A.decrease in inventoryB.depreciation expenseC.loss on sale of capital assetsD.interest received on notes receivable

3) The sale of inventory for cash is reported on the statement of cash flows under: A.investing activities.B.financing activities.C.non-cash investing and financing activities.D.operating activities.

4) The issuance of common shares for cash would be reported on a statement of cash flowsunder: A.the investing activitiesB.the operating activitiesC.the financing activitiesD.either investing activities or operating activities

5) Selling equipment is reported on the statement of cash flows under

A.financing activities.B.investing activities.C.operating activities.D.non-cash investing and financing activities.

6) Paying off bonds payable is reported on the statement of cash flows under A.investing activities.B.non-cash investing and financing activities.C.financing activities.D.operating activities.

7) The main source of cash for a business must come from operating activities if it is to prosper in the future. a. True

b. False

8) Income Tax Payable was $ 6500at the end of the year and $2,900 at the beginning. Income tax expense for the year totalled $59,700. What amount of cash did this company pay for income tax during theyear? A.$63,300B.$62,600C.$56,100D.$59,700

9)Which of the following activities increase and decrease the nonminuscurrent assets available to acompany?

A.warehousing activitiesB.financing activitiesC.investing activitiesD.operating activities

10) The payment of principal amounts(excluding interest) to creditors would be reported on a statement of cash flows underthe: A.operating activitiesB.investing activitiesC.financing activitiesD.either investing activities or financing activities