6. RedCo. reported cash paid for interest of $55,000 in its statement of cash flows for the current year. Red did not capitalize any interest during the current year. The following changes on their balance sheet occurred: accrued interest payable decreased by $13,000 along with a decrease in prepaid interest of $21,500. What amount should Red report as interest expense in its current year statement of income?

Multiple Choice

$89,500

$63,500

$76,500

$68,000

7. BlueCo. prepares its statement of cash flows using the indirect method. Blues bad debt allowance increased by $18,000 during the year and no accounts were written off. How should Blue report the change in its bad debt allowance in the statement of cash flows?

Multiple Choice

As a financing cash outflow.

As an addition to net income in the operating activities section.

As an investing cash outflow.

As a subtraction from net income in the operating activities section.

8. Red, Inc. had the following activities during 2018:

Acquired a bond investment for $40,000, which Red intends to hold to maturity.

Sold equipment to another corporation for $24,000 when the carrying value was $22,000.

Acquired a stock investment for $8,500, which Red intends to hold for trading.

Made a loan to an employee for $12,500.

Collected interest on a bond investment of $2,500.

In Reds 2018 statement of cash flows, net cash used in investing activities should be

Multiple Choice

$28,500

$39,500

$37,000

$56,500

9. Bell Co. prepares its statement of cash flows using the indirect method. Selected items pertaining to its cash flow are listed below. What amount should Bell Co. report as net cash provided by financing activities in its statement of cash flows for the year?

Bonds issued	$	90,000
Treasury stock repurchased	$	23,000
Trading securities purchased	$	35,000
Cash dividends paid	$	15,000
Gain on available-for-sale investment	$	11,000

Multiple Choice

$52,000

$63,000

$28,000

$90,000