Question & Answer: The following information is available. Calculate the cash flow for operating activities. Net Income 60 Depreciation Expense 5 De…..

Chapter 14 Quiz Version C The following information is available. Calculate the cash flow for operating activities. Net Income Depreciation Expense 5 Decrease in Acct. Rec. 6 Decrease in Acct. Pay. 3 Purchase of Equipment 15 Increase in Supplies 4 60 The company sold equipment with an original cost of $35 for $30. The accumulated depreciation was $25. The Company issued common stock for $ and retired a bond for $10. CCi 1. What is the net cash flow from operating activities? A. $42 B. $40 C. $44 D. $55 CA 2. What is the net cash flow from Investing Activities? $15 increase B. $15 decrease C. $10 increase D. $20 increase 3. What is the net cash flow from Financing Activities? A. $14 B. $ 5 C. ($14) D. (S 5) 4. What is the change in the cash account from all activities? A. $40 B. $34 C. $54 D. $41

The following information is available. Calculate the cash flow for operating activities. Net Income 60 Depreciation Expense 5 Decrease in Acct. Rec. 6 Decrease in Acct. Pay. 3 Purchase of Equipment 15 Increase in Supplies 4 The company sold equipment with an original cost of $35 for $30. The accumulated depreciation was $25. The Company issued common stock for $ and retired a bond for $10. What is the net cash flow from operating activities? A. $42 B. $40 C. $44 D. $55 What is the net cash flow from Investing Activities? A. $15 increase B. $15 decrease C. $10 increase D. $20 increase What is the net cash flow from Financing Activities? A. $14 B. $ 5 C. ($14) D. ($ 5) What is the change in the cash account from all activities? A. $40 B. $34 C. $54 D. $41

Expert Answer

 

Cash Flow from Operating Activities
Net Income $          60
Add Depreciation $             5
Add Decrease in Acc Receivable $             6
Less Profit on Sale of Equipment ($ 30 – $ 10) $        (20)
Less Decrease in Acc Pay $          (3)
Less Increase in Supplies $          (4)
Net Cash Flow (a ) $          44
Cash Flow from Investing Activities
Purchase of Equipment $        (15)
Add Sales of Equipment $          30
Net Cash Flow (b ) $          15
Cash Flow from Financing Activities
Issue of Common Stock $             5
Less Retire of Bond $        (10)
Net Cash Flow (c ) $          (5)
Change in Cash Account from All Activities (a + b + c) $          54
Ans 1 $44 C
Ans 2 $ 15 increase A
Ans 3 ($5) D
Ans 4 $54 C
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