21. How is depreciation expense classified on the statement of cash flows?
22. What are the two methods used to prepare the operating activities section of the statement of cash flows?
23. When the indirect method is used to prepare the operating activities section of the statement of cash flows, what is the starting point of that section?
24. When the indirect method is used to prepare the operating activities section of the statement of cash flows, are increases in current liabilities added or subtracted from net income to arrive at the net cash flow?
25. Can a company have a negative cash flow from operating activities for the year but still have a net income on the income statement? Explain.
26. Describe where on the Statement of Cash Flows one would find a noncash purchase of equipment.
27. How can cash flow from operating activities be greater than net income from operations?
28. Why are financial analysts interested in the statement of cash flows?
29. Interest expense and interest paid are shown as:
A. an operating item on the income statement and an investing activity on the statement of cash flows.
B. an operating activity on the statement of cash flows and a non-operating item on the income statement.
C. an operating item on the income statement and a financing activity on the statement of cash flows.
D. a financing activity on the cash statement and an operating item on the income statement.
30. Cash receipts from interest on a note receivable would be classified on the statement of cash flows in the:
A. operating activity section.
B. investing activity section.
C. financing activity section.
D. noncash financing and investing section.