Hyperion Enterprises received $120,000 in dividends from various holdings. Which would it do in this situation, and why? O It would report the $120,000 as a cash outflow from investing activities because dividends are monies paid to investors. O It would report the $120,000 as a cash inflow from investing activities because this is a cash inflow received from investment. O It would attach a separate note to the statement of cash flows because this is not directly related to operations. O It would report the $120,000 as a cash inflow from operating activities because this is a cash inflow reported on the income
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- Analyze the truth of these statements: Assume a corporation issued $2,000,000 of common stock in exchange for $2,000,000 of fixed assets. When preparing the Statement of Cash Flows using the indirect method this would be recorded in the Cash Flows from Investing Activities section as a cash outflow. Group of answer choices These statements are true. These statements are false. There is no way to determine the whether these statements are true or false. There is no such financial statement as the Statement of Cash Flows.Please answer the following questions: What is the principal disadvantage of the direct method of reporting cash flows from operating activities? What are the major advantages of the indirect method of reporting cash flows from operating activities? A corporation issued $2,000,000 of common stock in exchange for $2,000,000 of fixed assets. Where would this transaction be reported on the statement of cash flows? A retail business, using the accrual method of accounting, owed merchandise creditors (accounts payable) $320,000 at the beginning of the year and $350,000 at the end of the year. How would the $30,000 increase be used to adjust net income in determining the amount of cash flows from operating activities by the indirect method? Explain.Which of the following statements is CORRECT? The statement of cash flows reflects cash flows from operations and from borrowings, but it does not reflect cash obtained by selling new common stock. The statement of cash flows shows how much the firm's cash and short-term liquid securities (or cash equivalents), increased or decreased during a given year. The statement of cash flows reflects cash flows from operations, but it does not reflect the effects of buying or selling fixed assets. The statement of cash flows shows where the firm's cash is located; indeed, it provides a listing of all banks and brokerage houses where cash is on deposit. The statement of cash flows reflects cash flows from continuing operations, but it does not reflect the effects of changes in working capital.
- A long-term investment in bonds with a cost of $500,000 was sold for $600,000 cash. (a) What was the gain or loss on the sale? (b) What was the effect of the transaction on cash flows? (c) How would the transaction be reported on the statement of cash flows if cash flows from operating activitiesare reported by the indirect method?7. Examine each of the following transactions ( 1 ) through ( 5 ). Determine where each should be reported on a statement of cash flows. The possible locations are identified by items A through E. (1) Common stock of another company was accepted in exchange for a copyright. (2) Received cash dividends from available for sale equity securities. (3) Received principal payment on loan previously made to subsidiary company. (4) Used excess cash to purchase treasury stock. (5) Received cash settlement on a lawsuit. (A) Operating Activities (B ) Investing Activities (C) Financing Activities (D) Schedule of Noncash Financing and/or Investing Activities (E) Not Reported on the Statement of Cash Flows O A. 1 = C; 2 = B; 3 = A; 4 = B; 5 = A. B. 1 = D; 2 = A; 3 = B; 4 = C; 5 = A. OC. 1 = B; 2 = A; 3 = C; 4 = B; 5 = E. OD. 1 = C; 2 = C; 3 = B; 4 = C; 5 = E. OE. 1 = D; 2 = A; 3 = A; 4 = B; 5 = E.Study the Statement of Cash Flows given below and answer the following questions: 1.1 Calculate the amount paid out for company tax. (3 marks) 1.2 Did the company obtain funds from its financing activities? Motivate your answer with the relevant calculations. (3 marks) 1.3 Of what significance are the details of Westham Limited’s investing activities to a potential investor? (4 marks) 1.4 Write a report to the board of directors to provide an interpretation of the Statement of Cash Flows of Westham Limited for the year ended 31 December 2022. Your report must focus on the cash flows from operating activities, increase in inventory, increase in receivables, increase in payables and purchase of plant and equipment. (10 marks) INFORMATION The Statement of Cash Flows of Westham Limited for the year ended 31 December 2022 appears below: WESTHAM LIMITED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2022R Cash flows from operating activities (540 000) Operating profit 2 850 000…
- From the following list of items, match the item to the correct cash flow activity (assume the indirect method is used). Also assume IFRS is followed and that the company has chosen to classify dividends paid as financing activities. If you determine that any of the items do not belong in any activity category, then select the "non-cash flow" category. 1. Issuance of shares to investors Payment of dividends to shareholders Purchase of new property, plant, and equipment Proceeds from the sale of old property, plant, and equipment Gain or loss on the sale of property, plant, and equipment Net income Proceeds from a bank loan 2 3. 4. 5. 6. 7.1. How are the various asset, liability, and stockholders’ equity accounts on a typical corporate balance sheet measured and classified? 2. How do successive balance sheets and the income statements determine cash inflows and outflows for a period? 3. How does the information provided in the cash flow statement explain changes in noncash accounts on the balance sheet? 4. What are the distinctions between operating, investing, and financing sources and uses of cash?Hi! Can you please help me answer these three short questions? Please do. Thank you. Which of the following is presented under the investing activities section of a statement of cash flows? a. Purchase of equipment on account. b. Additional investment in debt securities. c. Issuance of additional shares of stock. d. Cash sales. Noncash items, such as depreciation expense, must be added to net income to arrive at net cash provided by (used in) operating activities when the indirect method is used. a. True b. False The standards does not provide definitive guidance in distinguishing material information from immaterial information, so it is necessary to exercise judgment in deciding if a transaction is material. a. True b. False
- 1. If depreciable equipment is sold at a gain, this transaction will appear the investing activities section only. the financing activities section only. both the operating activities and the investing activities sections. both the operating activities and financing activities sections. 2. Which of the following is true if a company reports an unrealized increase in fair value of available-for-sale securities using an allowance account? The spreadsheet and statement of cash flows do not reflect this transaction. The spreadsheet accounts for this transaction, but it is not reflected in the statement of cash flows. The spreadsheet does not account for this transaction, but it is reflected in the statement of cash flows. Both the spreadsheet and the statement of cash flows reflect this transaction.What appears to drive the operating cash flows of Yahoo? Yahoo! Engages in purchases and sales of marketable securities. Why do you believe Yahoo! pursue this activity? Yahoo! reports $33.21 million of deferred revenue. Based on your understanding of Yahoo!’s operation, what do you believe this amount represents?for Morston, Inc. have assembled the following data for the year icon to view the current accounts.) (Click the icon to view the transaction data.) ston's statement of cash flows using the indirect method. Include an accompanying schedule of non-cash investing and financing activities. .. he statement one section at a time, beginning with the cash flows from operating activities. (Use a m ox empty, do not select a label or enter a zero.) Data table Morston, Inc. Statement of Cash Flows Year Ended December 31, 2024 lows from Operating Activities: come 70,500 stments to Reconcile Net Income to Net Cash vided by (Used for) Operating Activities: Depreciation Expense Gain on Sale of Building Decrease in Accounts Receivable Increase in Merchandise Inventory Incroaco in Accounts Payabla Data table et asi Net Hel O Transaction Data for 2024: Issuance of common stock for cash Depreciation expense Purchase of equipment with cash Acquisition of land by issuing long-term notes payable Book value…