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Cash Flow Statements & Disclosures Chapter Exam

Exam Instructions:

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

Page 1

Question 1 1. Your company purchases a large piece of equipment. Which section of a cash flow statement will this affect?

Question 2 2. Which section of the cash flow statement changes depending on whether the direct or indirect method is used to prepare the statement?

Question 3 3. What source document would you use for the cash paid to employees section of a direct cash flow statement?

Question 4 4. Which method for creating a statement of cash flow do small businesses prefer using?

Question 5 5. What describes the indirect method of preparing a cash flow statement?

Page 2

Question 6 6. Which of the following categories of people do NOT rely on a company's timely reporting of financial data?

Question 7 7. Which of the following statements about the time period principle is FALSE?

Question 8 8. How do potential investors utilize a company's reported financial information?

Question 9 9. Why would employees be interested in the company's financial status?

Question 10 10. Which of the following entities established the time period principle?

Page 3

Question 11 11. Which of the following would be considered a non-cash investing activity?

Question 12 12. Which transaction must be disclosed at the bottom of the statement of cash flows?

Question 13 13. Which of these must be disclosed at the bottom of the statement of cash flows if the direct method is used?

Question 14 14. Non-cash investing and financing activities are disclosed:

Question 15 15. Which of the following should be disclosed at the bottom of the statement of cash flows?

Page 4

Question 16 16. ABC Ropes is interested in buying a retail store front to sell their ropes as they have previously only been selling online. ABC takes a loan from the bank in order to purchase a retail space outright. ABC receives a $250,000 loan from the bank to purchase their retail space. What is this $250,000 categorized as and what type of activity is it?

Question 17 17. What is the statement of cash flows?

Question 18 18. What is the section of the statement of cash flows that includes activities that occur during the normal day-to-day operations of a company?

Question 19 19. The statement of cash flows is broken down into how many activities?

Question 20 20. Which of the sections of the statement of cash flows includes activities that involve cash receipts or cash payments from changes on long-term liabilities?

Cash Flow Statements & Disclosures Chapter Exam Instructions

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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