Cash purchases of long-term assets are reported in the _______ activities section of the statement of cash flows. Operating B. Investing C.

1.       Cash purchases of long-term assets are reported in the _______ activities section of the statement of cash flows.

           A.  Operating

           B.  Investing

           C.  Financing

           D.  Non-cash investing and financing

2.        Cash payment of dividends is reported in the ______ activities section of the statement of cash flows.

           A.  Investing

           B.  Financing

           C.  Operating

           D. Dividends are not reported on the statement of cash flows.

3.        When using the indirect method, what should be subtracted from net income in determining net cash flow provided by operating activities?

           A.  Loss on sale of long-term assets

           B.  Increase in accounts payable

           C.  Depreciation expense

           D.  Increase in inventory

4.        Which of the following does not have an effect on cash?

           A. borrowing on a long-term note payable.

           B. issuance of common stock.

           C.  purchase of supplies.

           D.  recording depletion expense.

5.        The Hope Corporation purchased a large machine 7 years ago at a total cost of $250,000. The accumulated depreciation on this machine is $180,000. The corporation sold the machine at a $6,000 loss. What amount would be reported as cash proceeds from this sale?

           A. $64,000

           B. $76,000

           C. $6,000

           D. $70,000

6.        The Liu Company had $600,000 of sales revenue. During the same accounting period the beginning and ending accounts receivable balances were $27,000 and $29,000, respectively. What amount of cash was collected from the customers during this period?

           A. $600,000

           B.  $602,000

           C. $598,000

           D. $2,000

7.       Garcia Manufacturing Company had the following data:

December