1. Given the following activities:

Purchase of machinery $175,000

Repayment of bank loans 75,000

Sale to customer or account 60,000

Payment on mortgage payable 200,000

Payment to suppliers 65,000

Purchase of30 day treasury bill 15,000

The cash outflows for investing and financing activities were

a) investing $175,000; financing $310,000.

b) investing $190,000; financing $310,000.

c) investing $175,000; financing $275,000

d) investing $190,000; financing $275,00

2. Information on a companys cash flows is used for all of the following, except?

a) estimate the companys future cash requirements.

b) evaluate the potential for the company to be able to pay dividends in the future.

c) assess the companys ability to repay debt in the future.

d) evaluate a companys liquidity (i.e., the value of a companys liquid assets in comparison to its short-term debt obligations).

3. Under the indirect approach, adjustments must be made to net income in the operations section for all of the following items, except

a) loss on the sale of land.

b) gain on the sale of equipment.

c) proceeds for the issuance of preferred shares.

d) depreciation

4. Public companies cannot pay a dividend on the date of declaration?

a) True

b) False