Question

Which of the following statements is true? Investment in another company's common stock is classified as...

Which of the following statements is true?

  • Investment in another company's common stock is classified as a cash outflow from financing activities in the statement of cash flows.

  • Repayment of long-term debt is classified as a cash outflow from investing activities in the statement of cash flows.

  • Losses on the sale of long-term assets are an adjustment reported in the operating activities section of the statement of cash flows under the indirect method.

  • Dividends paid are classified as a cash outflow from operating activities in the statement of cash flows.

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

True: Losses on the sale of long-term assets are an adjustment reported in the operating activities section of the statement of cash flows under the indirect method.

Explanation:

Losses from sale of an asset is an adjustment whose effect is required to be removed from net income to find out cash flow from operating activities.

All other are false.

Repayment of long-term debt is classified as a cash outflow from financing activities and not investing activities..

Investment in another company's common stock is classified as a cash outflow from investing activities and not financing activities.

Dividends paid are classified as a cash outflow from financing activities and not operating activities.

If helpful, Thumbs UP please:)

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
9. The purchase of stock in another company is classified as a financing activity. True/False 12....
9. The purchase of stock in another company is classified as a financing activity. True/False 12. When preparing the operating activities section of the statement of cash flows using the indirect method, decreases in current operating liabilities are added to net income. True/False 13. The gain or loss from retirement of debt is reported under cash flows from operating activities on the statement of cash flows using the indirect method. True/False
1- When preparing a statement of cash flows using the indirect method, each of the following...
1- When preparing a statement of cash flows using the indirect method, each of the following should be classified as an operating cash flow except: Multiple Choice An increase in accounts receivable. A decrease in accounts payable. Proceeds from the disposal of a long-term asset with no gain or loss. An increase in prepaid expenses. A decrease in accrued expenses payable. 2- Marshland Company is preparing the company's statement of cash flows for the fiscal year just ended. The following...
McCorey Corporation recorded the following events last year: Repurchase by the company of its own common...
McCorey Corporation recorded the following events last year: Repurchase by the company of its own common stock $ 24,000 Sale of long-term investment $ 43,000 Interest paid to lenders $ 7,000 Dividends paid to the company's shareholders $ 53,000 Collection by McCorey of a loan made to another company $ 29,000 Payment of taxes to governmental bodies $ 17,000 On the statement of cash flows, some of these events are classified as operating activities, some are classified as investing activities,...
True or False 1. The approach to preparing the cash flow statement relies on the following...
True or False 1. The approach to preparing the cash flow statement relies on the following rearrangement of the balance sheet equation: Change in cash = Change in (Liabilities + Stockholders' Equity + Noncash Assets). 2. Major investing and financing activities that do not involve cash do not have to be reported as part of the statement of cash flows. 3. In the decline phase, the company continues to enjoy positive operating cash flows but stops spending cash on investing...
McCorey Corporation recorded the following events last year: Repurchase by the company of its own common...
McCorey Corporation recorded the following events last year: Repurchase by the company of its own common stock $ 26,000 Sale of long-term investment $ 45,000 Interest paid to lenders $ 8,000 Dividends paid to the company's shareholders $ 55,000 Collection by McCorey of a loan made to another company $ 31,000 Payment of taxes to governmental bodies $ 18,000 On the statement of cash flows, some of these events are classified as operating activities, some are classified as investing activities,...
Which of the following statements is incorrect regarding the investing activities section of the statement of...
Which of the following statements is incorrect regarding the investing activities section of the statement of cash flows? Multiple Choice a. Investing activities deal with long-term liabilities (debt) and equity accounts. b. Increases in long-term asset balances suggest cash outflows to purchase assets. c. Decreases in long-term asset balances suggest cash inflows from selling assets. d. Investing activities involve cash purchases and cash disposals of long-term assets.
1. The purchase of treasury stock will have what impact on the statement of cash flows?...
1. The purchase of treasury stock will have what impact on the statement of cash flows? A. Cash inflow from financing activities B. Cash outflow from financing activities C. Cash inflow from investing activities D. Cash outflow from investing activities 2. Cash inflows or outflows from investing activities would involve all of the following except: A. The proceeds from the sale of equipment B. The purchase of buildings C. The receipt of interest income on short-term investments D. The purchase...
Question 13. Which one of the following statements is correct according to IAS 7 Statement of...
Question 13. Which one of the following statements is correct according to IAS 7 Statement of Cash Flows? Preparing a statement of cash flows using the direct method gives a different cash flow from operating activities to that using the indirect method Cash flows from interest and dividends should be disclosed separately A statement of cash flows may be included as a primary statement in an entitys financial statements, or in the notes to the financial statements Financing activities include...
Question 13. Which one of the following statements is correct according to IAS 7 Statement of...
Question 13. Which one of the following statements is correct according to IAS 7 Statement of Cash Flows? Preparing a statement of cash flows using the direct method gives a different cash flow from operating activities to that using the indirect method Cash flows from interest and dividends should be disclosed separately A statement of cash flows may be included as a primary statement in an entitys financial statements, or in the notes to the financial statements Financing activities include...
The accountant for TI Company is preparing the company's statement of cash flows for the fiscal...
The accountant for TI Company is preparing the company's statement of cash flows for the fiscal year just ended. The following information is available: Retained earnings balance at the beginning of the year 151,000 Cash dividends declared for the year 46,000 Net income for the year 92,000 16) What is the ending balance for retained earnings? A. 264,000 B. 13,000 C. 243,000 D. 197,000 E. 105,000 17) Noncash investing and financing activities may be disclosed in A. A notes in...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT