QuIZ MOD 7 FINANCIAL ACCOUNTING

1. A company settles a long-term note payable plus interest by paying $68,000 cash toward the principal amount and $5,440 cash for the interest. Under the direct method of reporting interest, the $5,440 would be listed as a(n):

 

A purchase of new equipment on a note payable under the direct method would be reported:

 

Of the following, which is NOT classified as an investing activity on the statement of
cash flows?

 

An increase in long-term mortgage payable would mean a(n):

 

Of the following, which would be added back to net income in the operating section of a cash flow statement using the indirect method?

 

Which of the following would be added to net income in the indirect method of calculating cash flows from operations:

 

The methods of calculating cash flows from operations are:

 

Paying dividends is

 

If a company uses Cash Received from Customers as the first line of the cash flows from operations:

 

The reason the FASB requires the indirect method to be shown when the direct method is used in presenting cash flows from operations is: