1. Assume a company reported net income of $53,000, loss on the sale of equipment of $10,000, and gain on sale of investments of $21,000. If there were no other adjustments to reconcile net income to cash from operating activities, the cash inflow from operating activities must have been?

a) $63,000

b) $84,000

c) $42,000

d) $32,000

2. The Statement of Income reflects the overall change in cash flows for an accounting period.

a) True

b) False

3. Major differences between the income statement and the cash flow statement include all of the following except for

a) the income statement measures cash position.

b) the income statement captures mainly operating activities.

c) the income statement does not capture many creditor transactions.

d) the income statement is prepared on an accrual basis.

4. Non-cash expenses will reduce the amount of cash a company is able to generate from its operations.

a) True

b) False