Which of the following items would most likely be classifi ed as a financing activity?
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For all questions assume that the indirect method is used. Show There are four parts to the Statement of Cash Flows (or Cash Flow Statement): For each of the following items, indicate which part will be affected. Depreciation Expense. Proceeds from the sale of equipment used in the business. The Loss on the Sale of Equipment in Question #2. Declaration and payment of dividends on company's stock. Gain on the Sale of Automobile formerly used in the business. The proceeds from the sale of the automobile in Item #5. An increase in the balance in a retailer's Merchandise Inventory. An increase in the balance in Accounts Payable. Retirement of long-term Bonds Payable. Purchase of Treasury Stock (company's own stock). The purchase of a new delivery truck to be used in the business. A decrease in the balance of Accounts Receivable. An increase in Bonds Payable (a long-term liability). A decrease in the current asset account Prepaid Insurance. A decrease in the current liability Income Taxes Payable. The proceeds from issuing additional Common Stock. The amortization of the cost of an intangible asset. The exchange/conversion of long-term bonds into common stock. For items 19 - 30 indicate whether they will have a positive or negative EFFECT ON CASH. A positive effect could also be thought of as a source of cash, an increase in cash, or a positive amount on the cash flow statement. A negative effect could also be thought of as a use of cash, a decrease in cash, or a negative amount on the cash flow statement. An increase in the balance of Prepaid Insurance. A decrease in Supplies on hand. The proceeds from the sale of equipment formerly used in the business. The Loss on the Sale of Equipment in the previous question. An increase in the current liability Income Taxes Payable. A decrease in Accounts Payable. An increase in Accounts Receivable. An increase in the current liability Warranty Liability. Dividends declared and paid. Proceeds from the issuance of Preferred Stock. The Gain on the Sale of Equipment formerly used in the business. An increase in the long-term asset Investment in Another Company. For a recent year a corporation's financial statements reported the following:
Based on the above information, what amount will the corporation report as Net Cash Provided by Operating Activities on the cash flow statement? A corporation reported the following information for the past year:
 Assuming these are the only facts, what amount will the corporation report as the Net Cash Provided by Operating Activities on the cash flow statement? Using the information in Question #32, what amount will be reported under Cash From Investing Activities? Want more practice questions? Which of the following item would most likely be classified as financing activity?Answer and Explanation: The a) issuance of debt would most likely be classified as a financing activity. The issuance of debt and the cash flows that a business receives from that loan or bond is usually recorded as a financing activity rather than an investment or operating cash flow.
Which of the following would be classified as a financing activity?Answer and Explanation: Both a) interest paid to a lender and b) dividends paid to the company's common stockholders would be classified as financing activity on the statement of cash flows. Both of these activities are cash outflows that maintain financing from loans or the issuance of stocks.
What are included in financing activities?Cash Flow from Financing Activities is the net amount of funding a company generates in a given time period. Finance activities include the issuance and repayment of equity, payment of dividends, issuance and repayment of debt, and capital lease obligations.
Which of the following items would be classified as financing activities in a statement of cash flows?Financing activities. include cash activities related to noncurrent liabilities and owners' equity. Noncurrent liabilities and owners' equity items include (1) the principal amount of long-term debt, (2) stock sales and repurchases, and (3) dividend payments.
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