11) The payment of principal amounts (excluding interest) to creditors would be reported on a cash flow statement under the:
A) operating activities
B) investing activities
C) financing activities
D) either investing activities or financing activities
12) The issuance of common shares for cash would be reported on a cash flow statement under:
A) the operating activities
B) the investing activities
C) the financing activities
D) either investing activities or operating activities
13) Which of the following is a method for reporting cash flows from operating activities that begins with net income and reconciles to cash flows from operating activities?
A) cash-basis method
B) direct method
C) accrual method
D) indirect method
14) Which of the following is not an example of an operating activity?
A) dividends declared
B) dividend income
C) interest income
D) interest expense
15) Activities which lead to an increase or decrease in long-term debt of a corporation are referred to as:
A) operating activities
B) investing activities
C) financing activities
D) future debt activities
16) On an indirect method cash flow statement, the purchase of machinery in exchange for common shares is:
A) ignored
B) shown in the schedule of noncash investing and financing activities which accompanies the cash flow statement
C) reflected in the operating activities section
D) reflected in the investing activities section
17) Phosphoric Company reported capital assets, net of accumulated amortization, on January 1, 2010, at $645,000 and $732,500 on December 31, 2010. The income statement showed amortization of $48,300 and a $5,600 loss on sale of capital assets. Phosphoric Company acquired $213,000 of capital assets during the year. The proceeds from the sale of capital assets were:
A) $125,500
B) $89,900
C) $71,600
D) $77,200
18) Jantzi Company reported capital assets, net of accumulated amortization, on January 1, 2010, at $427,500 and $579,300 on December 31, 2010. The income statement showed amortization of $38,700. Jantzi Company acquired $275,000 of capital assets during the year and reported proceeds from the sale of capital assets of $89,200 for the year. The gain or loss resulting from the sale of capital assets was:
A) $3,400 loss
B) $2,390 loss
C) $4,700 gain
D) $5,050 gain
19) On January 1, 2010, Agronomist Inc. had a balance of $340,000 in the Investments account. During 2010, Agronomist Inc. sold investments for $115,000 cash, resulting in a $13,000 gain. On December 31, 2010, the Investments account showed a balance of $380,000. The investments purchased during 2010 totalled:
A) $75,000
B) $265,000
C) $155,000
D) $142,000
20) The balance in Common Shares on January 1, 2010, and December 31, 2010, is respectively $145,000 and $172,500. During the year, $57,000 repurchase of shares was recorded. During the year, shares were issued. The proceeds from the issue of shares amounted to:
A) $29,500
B) $64,500
C) $84,500
D) $260,500