1.There are two alternatives to reporting cash flows from operating activities i

Question

1.There are two alternatives to reporting cash flows from operating activities in the statement of cash flows: (1) the direct method and (2) the indirect method. a. True b. False 2. Which of the following is not one of the four basic financial statements? a. balance sheet b. statement of cash flows e. statement of changes in financial position d. income statement 3.Which of the following can be found on the statement of cash flows? cash flows from operating activities a b. total assets c total changes in stockholders' equity d. changes in retained earnings 4.0n the statement of cash flows, the cash flows from operating activities section would include a receipts from the issuance of capital stock b. receipts from the sale of investments c. payments for the acquisition of investments d. cash receipts from sales activities s. Cash paid to purchase long-term investments would be reported in the statement of cash flows in the cash flows from operating activities section a b. the cash flows from financing activities section c the cash flows from investing activities section d. a separate schedule 6.Cash dividends paid on capital stock would be reported in the statement of cash flows in a the cash flows from financing activities section b. the cash flows from investing activities section c. a separate schedule d. the cash flows from operating activities section

Explanation / Answer

Answer Explanation 1 TRUE Cash Flow Statements can be prepared by Using two Methods 2 C Statement of Changes in Financial Position 3 A Cash Flow Statement has three components 1. Cash flow from Operating Activities 2. Cash flow from Investing Activities 3. Cash Flow from Financing Activities 4 D Operating Section of Cash Flow include Items related to Operating Business 5 C Investments and Changes in Fixed Assets are recorded in Investing Section 6 A Changes to Common Stock and Any Dividend are reported in Financing Section

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