Current assets include cash and other assets that are reasonably expected to be converted to cash or consumed during one year or within the normal operating cycle of the business if the operating cycle is longerthan one year. All other assets are classified as various types of noncurrent assets. In addition to cash andcash equivalents, current assets include short-term investments, accounts receivable, inventories, and prepaid expenses. Other asset classifications include investments; property, plant, and equipment; intangibleassets; and other assets

Current assets include cash and other assets that are reasonably expected to be converted to cash or consumed during one year or within the normal operating cycle of the business if the operating cycle is longerthan one year. All other assets are classified as various types of noncurrent assets. In addition to cash andcash equivalents, current assets include short-term investments, accounts receivable, inventories, and prepaid expenses. Other asset classifications include investments; property, plant, and equipment; intangibleassets; and other assets

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Description: Current assets include cash and other assets that are reasonably expected to be converted to cash or consumed during one year or within the normal operating cycle of the business if the operating cycle is longerthan one year. All other assets are cla

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter14: Statement Of Cash Flows

Section: Chapter Questions

Problem 11MCQ: The gain on sale of equipment is deducted from net income to arrive at operating cash flows because...

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Which of the following statements is true? A. Current liabilities are debts expected to be paid out of current assets within the next year. B. Property, plant, and equipment are classified as intangible assets on the statement of financial position. C. Current assets are resources of a company which might include cash and copyrights. D. Accumulated depreciation is the amount of depreciation on the income statement for the current year.
Choose the word or phrase that is defined or indicated. 1. Obligations expected to be settled in the next year or operating cycle. select an appropriate term 2. Statement showing assets, liabilities, and equity at a point in time. select an appropriate term 3. Present obligations of an entity to transfer economic resources as a result of past events. select an appropriate term 4. Resources expected to be used, sold, or converted to cash in one year or the operating cycle, whichever is longer. select an appropriate term 5. Tangible long-lived assets used in regular operations. select an appropriate term 6. Economic rights or…
19. The current assets section of the statement of financial position should include * b. patents. a. machinery. d. inventory c. goodwill. 20. Equity or debt securities held to finance future construction of additional plants should be classified on a balance sheet as * c. intangible assets. a. current assets. d. long-term investments b. property, plant, and equipment. 21. In a statement of cash flows, receipts from sales of property, plant, and equipment and other productive assets should generally be classified as cash inflows from * d. selling activities c. investing activities. a. operating activities. b. financing activities. 22. The statement of financial position * d. All of the choices are correct regarding the statement of financial position. c. Uses fair value for most assets and liabilities. b. Makes very limited use of judgments and estimates. a. Omits many items that are of financial value. 23. The basis for classifying assets as current or noncurrent is…
What is unique about reporting current assets? Current assets are reported after they are converted into cash Current assets are reported in the order of their liquidity Current assets are reported net of depreciation Current assets are reported from highest to lowest
The most closely comparable operational activities include The phrase "long-term asset" refers to anything that will last a long time.Current assets and current liabilities are assets and obligations that are now in existence.responsibilities for the long term and shareholders' equitythe payment of dividends and the purchase of treasury stock
If a company reports a gain/(loss) from the sale of assets, as part of the net income on the income statement, and the net book value of those assets on the date of the sale is known, can the amount of the cash proceeds from the sale be determined? If so, how?
The gain on sale of equipment is deducted from net income to arrive at operating cash flows because a. the sale of long-term assets is an operating activity. b. the gain reveals the total cash received. c. all of the cash received from the sale is reported in the operating section. d. All of these. e. None of these.
Fill in the blanks: For calculating cash flow from operating activities, provision for doubtful debts is ________________ the profit made during the year (added to/deducted from).
Illies Corporation's comparative balance sheet appears below: Beginning Balance Assets: Current assets Cash and cash equivalents. Accounts receivable. Inventory. Total current assets Property, plant, and equipment. Less accumulated depreciation. Net property, plant, and equipment. Total assets. Liabilities and Stockholders' Equity Current liabilities: Accounts payable. Accrued wages and salaries payable.. Accrued income taxes payable. Notes payable. Total current liabilities. Long-term debt. Deferred income taxes. Total liabilities Stockholders' equity: Common stock. Retained earnings. Ending Balance Select one: $ 40,000 19,000 O a. $7,000 O b. $40,000 O c. $29,000 O d. $33,000 67,000 126,000 123,000 358,000 339,000 156,000 132,000 202.000 $328,000 $ 33,000 21,000 69,000 $ 18,000 35,000 23,000 207.000 $330,000 23,000 103,000 22,000 102,000 Total stockholders' equity 126,000 124.000 Total liabilities and stockholders' equity.... $328,000 $330.000 $ 19,000 37,000 19,000 19,000 22,000…
The following information can be obtained by examining a company's balance sheet and income statement information: a. Increases in current asset account balances, other than cash. b. Decreases in current asset account balances, other than cash. c. Cash outflows to purchase long-term assets. d. Decreases in current liability account balances. e. Cash outflows to repay long-term debt. f. Gains recognized on the sale of long-term assets. g. Noncash expenses (e.g., depreciation). h. Cash outflows to purchase treasury stock. i. Increases in current liability account balances. j. Cash inflows from the sale of long-term assets. k. Cash inflows from the issue of common stock. I. Cash outflows to pay dividends. m. Losses incurred from the sale of long-term assets. n. Cash inflows from the issue of long-term debt. Required For each item, indicate whether it would be used in the computation of net cash flows from operating, investing, or financing activities. Also, indicate whether the item would…
The purchase of a long-term asset is classified in the statement of cash flows as a(n) a. Operating activity. b. Investing activity. c. Financing activity. d. Noncash activity.
The following are common categories on a classified balance sheet. A. Current assets C. Plant assets E. Current liabilities B. Long-term investments D. Intangible assets F. Long-term liabilities For each of the following items, select the letter that identifies the balance sheet category where the item typically would best appear. 1. Land held for future expansion 5. Accounts payable 2. Notes payable (due in five years) 6. Store equipment 3. Accounts receivable 7. Wages payable 4. Trademarks 8. Cash