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c5
Student: ___________________________________________________________________________
1. Which one of the following items is not generally used in preparing a statement of cash flows?
A. Comparative statements of financial position
B. Current income statement
C. Additional information
D. Adjusted trial balance
2. Which of the following transactions would not create a cash flow?

A. The company purchased some of its own shares from a shareholder.
B. Amortization of patent for the period.
C. Payment of a cash dividend.
D. Sale of equipment at book value (i.e. no gain or loss).
3. Which of the following transactions is not a direct source of cash?

A. Disposal of inventory for cash.
B. Borrowing cash.
C. Sale and issuance of shares for cash.
D. Sale of services on credit.
4. Which of the following transactions is not a direct use of cash?

A. Acquisition of inventory for cash.
B. Purchase of treasury shares with cash.
C. Exchanges of bonds payable for land.
D. Cash dividend paid.
5. How should the statement of cash flows be dated?

A. December 31, 20X.
B. At Year-End December 31, 20X.
C. For the Year Ended December 31, 20X.
D. At December 31, 20X.
6. The category that is generally considered to be the best measure of a company's ability to continue as a going
concern is
A. cash flows from investing activities.
B. cash flows from financing activities.
C. cash flows from operating activities.
D. usually different from year to year.
7. Which of the following transactions is not a typical use of cash?

A. Payment of short-term debt with cash.
B. Purchase of treasury shares for cash.
C. Acquisition of a building for cash.
D. Sale of equipment for less than book value.
8. Which of the following would not be a cash flow from investing activities?
A. Purchase of long-term investments.
B. Sale of a patent.
C. Collection of principal of a note receivable.
D. Collection of interest revenue on a long-term note.
9. Which of the following would not be a cash flow from financing activities?
A. Issuance of common shares.
B. Borrowing on a long-term note payable.
C. Repayment of principal on a long-term note payable.
D. Collection of a cash dividend.
10. Which of the following is a cash flow from operating activities?

A. Purchase of merchandise for resale.
B. Sale of a piece of land no longer used in operations.
C. Sale of long-term investments in common shares.
D. Payment of a note payable.
11. Which of the following would not be a cash equivalent?

A. A $10,000, 30 day certificate of deposit.
B. 500 shares of RIM shares.
C. A three-month Treasury bill.
D. A ten-year Treasury note purchased two months before maturity.
12. Which of the following is a cash inflow from financing activities?
A. proceeds from selling investments in equity securities of another company.
B. proceeds from selling equipment.
C. proceeds from issuance of bonds payable.
D. receipt of interest payments.
13. For an investment to qualify as a cash equivalent, it must be readily convertible to a known amount of cash
and which of the following?
A. it must be identified as a cash equivalent on the income statement.
B. it must mature within 4 months.
C. the investment must have a known foreign exchange rate.
D. must be sufficiently close to its maturity date so that its market value is relatively insensitive to interest rate
changes.
14. A cash inflow from operating activities includes which of the following?
A. collection of the principal of a loan.
B. collection of sales price of equipment used in operations of the business.
C. proceeds from issuance of notes payable.
D. receipt of interest on an investment.
15. Which of the following statements about the statement of cash flows is correct?
A. A company with a net loss on the income statement will always have a net cash outflow from operating
activities.
B. A purchase of equipment is classified as a cash inflow from investing activities.
C. Cash dividends received on equity investments are classified as cash flows from operating activities.
D. Cash dividends paid are classified as cash flows from operating activities.
16. Which of the following items about the statement of cash flows is correct?
A. Noncash expenses such as depreciation are deducted from profit with the indirect method in computing cash
flows from operating activities.
B. Cash equivalents are highly liquid investments with maturities at the date of purchase of less than three
months.
C. The acquisition of land by issuing bonds payable would not appear on the statement of cash flows.
D. Cash paid for interest would be classified as a financing cash flow.
17. Which of the following statements about the statement is correct?
A. The sale of an investment in bonds for less than the carrying value of the investment would be reported as
cash outflow from financing activities.
B. The sale and issuance of common shares for cash would be reported as a cash inflow from financing
activities.
C. The retirement of bonds payable by the issuance of common shares would be reported as a cash inflow from
investing activities.
D. Collecting cash interest revenue on a note receivable would be reported as a cash inflow from investing
activities.
18. Toga Corporation reported profit of $50,000 for the year. During the year, trade receivables increased by
$8,000, trade payables decreased by $4,000 and depreciation expense of $6,000 was recorded. Net cash
provided by operating activities for the year, using the indirect method, is
A. $54,000.
B. $44,000.
C. $56,000.
D. $50,000.
19. Winn Company's 20B income statement reported total revenues, $110,000, and total expenses (including
$10,000 depreciation), $70,000 (i.e., a profit of $40,000). The 20B balance sheet reported the following: trade
receivables--beginning balance, $16,000 and ending balance, $14,000; wages payable--beginning balance,
$2,000 and ending balance, $1,500. Therefore, based only on this information, the 20B net cash inflow from
operating activities was which of the following?
A. $48,500.
B. $50,000.
C. $51,500.
D. $59,500.
20. Jackson Company gathered the following data to prepare its 20B statement of cash flows:
Based only on the above data, the net cash inflow from operating activities during 20B was which of the
following?
A. $43,000.
B. $45,000.
C. $51,000.
D. $53,000.
21. Matlock Company reported total sales revenue of $55,000 and total expenses amounting to $45,000 (i.e.,
profit of $10,000) on its income statement for the year ended December 31, 20B. During 20B, trade receivables
decreased by $4,000, merchandise inventory decreased by $6,000, trade payables increased by $2,000 and
depreciation of $8,000 was recorded. Therefore, based only on this information, the net cash flow from
operating activities for 20B was which of the following?
A. $10,000.
B. $18,000.
C. $19,000.
D. $30,000.
22. Allen Company reported total sales revenue of $150,000 and total expenses of $152,000 (i.e., a net loss of
$2,000) for the year ended December 31, 20D. During 20D, trade receivables decreased by $1,000, trade
payables increased by $5,000, wages payable increased by $3,000, and $18,000 in depreciation expense was
recorded. Assuming no other adjustments are needed, what was the "net cash flow from operating activities" for
20D (parentheses indicate net cash outflow)?
A. ($1,000).
B. $23,000.
C. $25,000.
D. $29,000.
23. Assume the 20D income statement reported total sales revenue of $160,000. The 20C-20D, comparative
statements of financial position showed that trade receivables increased by $10,000. What was the "cash inflow
from customers" for 20D?
A. $140,000.
B. $150,000.
C. $160,000.
D. $170,000.
24. Restless Company's 20B income statement reported total sales revenue of $100,000. The 20A-20B,
comparative statements of financial position showed that trade receivables decreased by $10,000. What were
the 20B "cash receipts from customers"?
A. $80,000.
B. $90,000.
C. $100,000.
D. $110,000.
25. WT Company reported sales revenue of $100,000 and total expenses of $90,000 (including depreciation) for
the year ended December 31, 20A. During 20A, trade receivables decreased by $4,000, merchandise inventory
increased by $3,000, trade payables increased by $2,000, and depreciation expense of $6,000 was recorded.
Assuming no other data are needed, what was the net cash inflow from operating activities for 20A?
A. $19,000.
B. $20,000.
C. $21,000.
D. $24,000.
26. Trade receivables arising from sales to customers amounted to $35,000 and $40,000 at the beginning and
end of the year, respectively. Profit reported on the income statement for the year was $120,000. Exclusive of
the effect of other adjustments, the cash flows from operating activities, prepared using the indirect method, is
A. $120,000.
B. $155,000.
C. $115,000.
D. $125,000.
27. ABC Company reported total sales revenue of $80,000 and total expenses of $72,000 (i.e., profit of $8,000)
for the year ended December 31, 20X. During 20X, trade receivables increased by $3,000, merchandise
inventory decreased by $2,000, trade payables increased by $1,000, and $5,000 in depreciation expense was
recorded. Assuming no other adjustments to profit are needed, what was the net cash inflow from operating
activities?
A. $10,000.
B. $11,000.
C. $13,000.
D. $19,000.
28. The statement of cash flows (indirect method) reports depreciation expense as an addition to profit because
depreciation does which of the following?
A. causes an inflow of funds for the replacement of assets.
B. reduces reported profit of the period but does not involve an outflow of cash for that period.
C. is a direct use of cash.
D. reduces reported profit and causes an inflow of cash.
29. To prepare a statement of cash flows (indirect method), which of the following items should be added back
to profit to derive "cash flow from operating activities"?
A. Depreciation expense.
B. Increase in trade receivables.
C. Gain on a sale of equipment.
D. Decrease in trade payables.
30. Travis Company reported a profit for 20B of $20,000, building depreciation expense of $6,000, and
amortization expense (patent) of $5,000. Also, trade payables increased by $7,000 and inventory decreased by
$2,000. What was the amount of "cash flows from operating activities" for 20B?
A. $34,000.
B. $35,000.
C. $36,000.
D. $40,000.
31. The 20B income statement of Dunn Company reported total sales revenue of $106,000 and total expenses of
$108,000 (i.e., net loss, $2,000). Expenses were: building depreciation, $10,000 and patent amortization,
$5,000. There was an increase in inventory of $1,000. What was cash flow from operating activities during 20B
(parentheses indicate outflow)?
A. ($3,000).
B. $7,000.
C. $12,000.
D. $14,000.
32. Which of the following is not true of the direct method of preparing a statement of cash flows?
A. it gives the user a sense of the magnitude of gross dollars flowing in and out of the company.
B. it has the same cash flows from investing and financing activities as the indirect method.
C. it has a different net cash inflow (outflow) from operating activities than the indirect method.
D. it reports the same net increase or decrease in cash as the indirect method.
33. The financial statements for Ozzie Company show the following:
How much cash was paid for merchandise?

A. $117,000.
B. $119,000.
C. $121,000.
D. $124,000.
34. The 20B income statement for Ryan Corporation showed the following:
What was the cash flow from operating activities?

A. $66,000.
B. $70,000.
C. $82,000.
D. $86,000.
35. Which statement regarding the indirect method is false?

A. Depreciation expense is added back to profit.
B. An increase in trade receivables is added to profit.
C. An increase in trade payables is added to profit.
D. An increase in merchandise inventory is subtracted from profit.
36. The financial statements of Juliet Company show the following:
How much cash was collected from customers?

A. $148,000.
B. $150,000.
C. $154,000.
D. $160,000.
37. Which of the following statements about cash flows from operating activities, in a statement of cash flows
prepared under the indirect method, is correct?
A. An increase in trade receivables would be subtracted from profit.
B. An increase in salaries payable would be subtracted from profit.
C. An increase in inventory would be added to profit.
D. Depreciation expense would be subtracted from profit.
38. Which of the following statements about the quality of earnings ratio is true?
A. When sales are growing, receivables and inventory normally increase faster than trade payable so the ratio
increases.
B. Seasonal variations in sales have no impact on the quality of income ratio.
C. Failure to accrue appropriate expenses will inflate profit and reduce the quality of income ratio.
D. Failure to accrue appropriate expenses will inflate net profit and increase the quality of income ratio.
39. Which of the following statements about the quality of earnings ratio is false?
A. An increase in operating assets and a decrease in liabilities will reduce operating cash flows, thereby
reducing the ratio.
B. Seasonal variations in sales and purchases of inventory can cause wide deviations in the quality of earnings
ratio.
C. When sales are growing, receivables and inventory normally increase at a faster rate than trade payables
often causing operating cash flows to be less than profit.
D. Seasonal variations in sales have no impact on the quality of earnings ratio.
40. In 2012, The W D Company reported profit of $1.3 billion and cash flow from operations of $5.6 billion. In
2011, it profit was $1.9 billion and cash flow from operations was $5.1 billion. What were their quality of
income ratios for 2012 and 2011 respectively?
A. .23 and .37
B. .91 and 1.46
C. 1.10 and .68
D. 4.31 and 2.68
41. In 2012, C Co. reported a quality of earnings ratio of 1.60. In 2011 and 2010 the ratio was .97 and .98
respectively. Which of the following was the most likely cause of the large increase in the ratio?
A. An increase in current assets such as receivables and inventory.
B. An increase in trade payables and accrued liabilities.
C. An increase in sales revenue while profit remained the same.
D. None of these is a likely cause.
42. If a loss of $20,000 is incurred in selling (for cash) office equipment that cost $90,000 and had accumulated
depreciation of $22,500, the total amount reported in the investing activities section of the statement of cash
flows is
A. $70,000.
B. $67,500.
C. $47,500.
D. $87,500.
43. Typical financing activities do NOT include the following:
A. Proceeds from issuance of short- and long-term borrowings.
B. Principal payments on short- and long-term borrowings.
C. Purchase of short- or long-term investments for cash.
D. Purchase of shares for retirement.
44. In 2012, C Co. disclosed cash paid for property, plant and equipment of $1.069 million and cash flow from
operations of $3.883 million. Their average property, plant and equipment from the comparative statement of
financial position was $3.968 million. Compute C Co.'s capital acquisitions ratio for 2012.
A. .28
B. .77
C. .98
D. 3.63
45. In the years 2005-2008, B Co.'s capital acquisitions ratio was 2.74 and from 2009-2012, it was 1.24. From
2009-2012, R Co.'s ratio was .30. Which of the following statements about B Co.'s capital acquisitions ratio is
correct?
A. B Co.'s capital acquisitions ratio is relatively low and indicates inability to finance property, plant and
equipment with cash flow from operations.
B. It appears that R Co. is more aggressive about investing in additional property, plant and equipment than is B
Co.
C. B Co.'s ratio has improved in the period 2009-2012.
D. It appears that B Co. is more aggressive about investing in additional property, plant and equipment than is R
Co.
46. Randy, Inc., issued $50,000 of bonds, paid cash dividends of $8,000, sold long-term investments for
$12,000, received $5,000 of dividend revenue, purchased treasury shares for $15,000, and purchased new
equipment for $19,000. What is the net cash flow from financing activities?
A. ($20,000).
B. $27,000.
C. $70,000.
D. $80,000.
47. A company acquired some land (independently appraised at $12,000) and paid for it by issuing 1,000 shares
of its common shares (par $10 per share; no market price was quoted). How should this be reported on the
statement of cash flows?
A. Report $12,000 as inflow and outflow of cash.
B. Report $12,000 as an inflow of cash.
C. Should not be reported on the statement of cash flows.
D. Report on a schedule of significant noncash transactions if it is material.
48. Lori Company sold an operational asset, a machine, for cash. It originally cost $20,000. The accumulated
depreciation at the date of disposal was $15,000. A gain on the disposal of $2,000 was reported. What was the
cash inflow from this transaction?
A. $3,000.
B. $4,000.
C. $5,000.
D. $7,000.
49. Nelson Company collected the following data in its accounting records in 20B:
No new equipment was purchased during the year. What was the cash inflow from the sale of equipment in
20B?
A. $600.
B. $900.
C. $1,000.
D. $3,900.
50. The income statement, statement of financial position and statement of cash flows all are prepared on the
accrual basis.
True False
51. The statement of cash flows and the statement of cash flows both report on the causes of the changes in the
cash of the business.
True False
52. The net cash inflow or outflow for the year is the same amount as the increase or decrease in cash and cash
equivalents for the year.
True False
53. The statement of cash flows is dated exactly like the income statement but unlike the statement of financial
position.
True False
54. Short-term investments in marketable equity securities are considered the equivalent of cash (i.e., they are
combined with cash) in preparing the statement of cash flows.
True False
55. Cash equivalents are highly liquid investments with original maturities of less than six months.
True False
56. When the statement of cash flows is prepared in conformity with IFRS there is only one acceptable way to
measure and report cash flows from operating activities.
True False
57. The net cash inflow (or outflow) from operating activities is computed by adjusting the reported accrual
profit for noncash revenue and noncash expense items.
True False
58. If there is a change in cash, there will be a change in one or more noncash accounts.
True False
59. When a cash dividend is paid, the cash outflow is classified as an operating activity.
True False
60. Cash equivalents are defined as short-term, highly liquid investments that are readily convertible into known
amounts of cash and are so near their maturity that there is insignificant risk of changes in their value due to
interest rate changes.
True False
61. The statement of cash flows is the only financial statement prepared on the cash basis of accounting rather
than on the accrual basis of accounting.
True False
62. Only investments with original maturities of less than three months at the date of purchase qualify as cash
equivalents.
True False
63. Cash collected from customers is a cash flow from a financing activity.
True False
64. The amortization of a patent is treated in a similar manner to depreciation of a building when preparing the
operating activities section of the statement of cash flows using the indirect method.
True False
65. The payment to shareholders for repurchase of treasury shares is a cash flow from a financing activity.
True False
66. The payment of interest on a note payable is a cash flow from an operating activity.
True False
67. Dividends collected from a long-term investment are cash flows from investing activities.
True False
68. Collection of principal on a note receivable is a cash flow from investing activities.
True False
69. Loans to other companies (notes receivable) are cash flows from investing activities.
True False
70. The date in the heading of a statement of cash flows should say, "At December 31, 20A," rather than "For
the Year Ended December 31, 20A."
True False
71. Very few companies use the direct method for disclosing their cash flows from operating activities.
True False
72. The net increase (or decrease) in cash that is reported on the statement of cash flows should be the same as
the change in the balance of the cash account for the two most recent years on the comparative statements of
financial position.
True False
73. The sales revenue reported on the income statement for 20A totaled $96,000, of which one third was on
credit. The 20A beginning balance of trade receivables was zero and the 20A ending balance reported on the
statement of financial position was $10,000; therefore, the 20A cash inflow from customer sales was $86,000.
True False
74. Expenses reported on the income statement for 20A (the first year of operations), totaled $60,000, which
included depreciation expense of $8,000, and wages payable increased to $3,000 by the end of 20A. Therefore,
the 20A cash outflow for expenses was $71,000.
True False
75. Depreciation expense does not cause a cash outflow for the current period; therefore, it should never be
shown on the statement of cash flows.
True False
76. In order to prepare the statement of cash flows, the accountant must analyze current asset and current
liability balances.
True False
77. The indirect method for reporting cash flows from operating activities presents a conversion of profit to net
cash flow from operating activities.
True False
78. Depreciation expense has the immediate effect of increasing the cash account.
True False
79. Increases in current liabilities are added to profit while decreases in current liabilities are subtracted from
profit to derive the net cash flows.
True False
80. The quality of earnings ratio (Cash Flow from Operating Activities ¸ Profit) measures the portion of profit
that was generated in cash.
True False
81. Investing activities include cash proceeds from the sale of property, plant, and equipment, and short- and
long-term investments.
True False
82. A higher quality of earnings ratio indicates that it is less likely that the company is using aggressive revenue
recognition policies to increase profit.
True False
83. Investing activities reported on the statement of cash flows include cash payments to acquire property, plant,
and equipment, and short- and long-term investments.
True False
84. The capital acquisitions ratio (Cash Flow from Operating Activities ¸ Cash Paid for Property, Plant, and
Equipment) reflects the portion of purchases of property, plant, and equipment financed from operating
activities without the need for outside debt or equity financing or the sale of other investments or other
long-term assets.
True False
85. A low capital acquisitions ratio indicates a higher need to obtain outside financing to expand property, plant,
and equipment assets.
True False
86. Cash payments associated with interest relate to operating activities.

True False
87. Non-cash investing and financing activities are disclosed only as supplemental disclosures to the statement
of cash flows in either narrative or schedule form.
True False
88. Wish Corporation acquired a computer for $15,000 and paid for it in full by issuing 1,000 shares of its own
common shares, par $10 (current market price $15 share). This transaction should not be reported on the
statement of cash flows because cash was neither paid out nor received.
True False
89. A transaction that does not cause an inflow or outflow of cash should be reported on the statement of cash
flows only if it is an adjustment to convert accrual profit to the cash basis.
True False
90. The purchase of a piece of equipment in exchange for common shares must be reported on the statement of
cash flows.
True False
91. Billton Company purchased a machine in the current year for $18,000. Payment included cash, $5,000; a
one-year note payable, $5,000; and a 2-year, $8,000 note payable. This decreases cash by $5,000 in the current
year.
True False
92. When using the indirect method, a loss on the sale of equipment should be added to profit to derive cash
True False
93. Match each activity below with the proper classification by inserting the proper capital letter in the space to
the left.
Classification of Activity
I. Investing
F. Financing
O. Operating
Activity
____ 1. Collection of interest on a note receivable.

____ 2. Payment of debt principal with cash.
____ 3. Sales of operational assets (used in the business).
____ 4. Payment of cash dividends.
____ 5. Issuance of shares for cash.
____ 6. Borrowing cash from the bank.
____ 7. Purchase of operational assets for cash.
____ 8. Collections of dividends on long-term investments.
94. Indicate the proper classification for each of the transactions by inserting the proper letter in the space to the
left.
Classifications
A. Operating Activities
B. Investing Activities
C. Financing Activities
D. Schedule of non-cash transactions
E. Not included in the statement of cash flows
Transaction
____ 1. Declared a cash dividend.

____ 2. Paid a previously declared cash dividend.
____ 3. Issued shares for a new machine.
____ 4. Borrowed cash on a short-term note.
____ 5. Borrowed cash on a long-term note.
____ 6. Purchased treasury shares for cash.
____ 7. Paid interest on a note payable.
____ 8. Purchased treasury shares and gave a long-term note payable.
____ 9. Purchased land with a short-term note payable.
___ 10. Purchased shares in another company.
___ 11. Purchased land for cash.
95. For each of the following items, indicate whether they would appear in the operating, investing, or financing
activities section of the statement of cash flows. Place a check mark in the appropriate column for each
transaction. If neither an operating, investing, or financing activity is appropriate, place a check mark in the
"none" column. Assume the indirect method is used for reporting.
96. Using the indirect method, calculate the amount of cash flows from operating activities from the following
data:
97. The comparative statements of financial position for Hirj Inc. appear below:
Additional information:
1. Profit for the year ending December 31, 2012 was $27,000.
2. Cash dividends of $13,000 were declared and paid during the year ended December 31, 2012.
3. Long-term investments that had a carrying amount of $23,000 were sold for $18,000 in 2012.
Required: Prepare a statement of cash flows for the year ended December 31, 2012, using the indirect method.
98. Use the following information to prepare a statement of cash flows (direct method) for Yoyo Corporation
for the year ended December 31, 20B.
99. Morgan Company is preparing a statement of cash flows using the indirect method. The following data are
available:
100. Reba Company reported profit of $10,000 for 20A. Additional 20A information is as follows:
Based on the information given above, the statement of cash flows would show "cash flows from operating
activities" of $______________
101. McIntire Company reported profit of $40,000 which included depreciation expense and depletion expense
of $21,000 and $18,000, respectively. The following changes also occurred during 20C
The amount of "cash flows from operating activities" was $______________

102. Complete the following statement of cash flows using the indirect method:
103.
The following changes were noted from the statement of financial position: trade receivables increased $8,000;
inventory increased $4,000; trade payables increased $6,000; prepaid expense decreased $2,000; accrued
liability decreased $5,000; and interest payable increased $1,000
Required: Prepare the operating activities section of the statement of cash flows using the indirect method.
104. The following information was reported from the statement of cash flows for The W D Company for the
years 2010 through 2012 in millions of dollars:
A. Calculate the quality of income ratio for the years 2010 through 2012.
B. Interpret the quality of earnings ratio for The W D Company for the three year period.
105. C Co. reported the following information from their statement of cash flows in millions of dollars:
(A) Calculate the quality of income ratio for C Co for the three years:
(B) In 2011, P Co. reported a quality of earnings ratio of 1.61. Compare C Co.'s quality of earnings ratio for that
year to their competitor's ratio.
106. The following information was available from the financial statements of C Co. Company for the years
2011 and 2012 in millions of dollars:
A. Calculate the capital acquisitions ratio for C Co. for the two years:
B. Comment on the sufficiency of the capital acquisitions ratio for the two years.
107. The following information is provided from the cash flow statement for Toys 4 U for the years 2008
through 2012 in millions of dollars:
(A) Calculate the capital acquisitions ratio for Toys 4 U for the five year period from 2008 to 2020.
(B) Comment on the capital acquisitions ratio for Toys 4 U for the five years.
108. While preparing a statement of cash flow, you encountered the following transaction:
February 1, 20A: Zorro Corporation acquired a small office building in exchange for 5,000 shares of its own
common shares; par value $10 per share; market value $15 per share.
(a) Should this transaction be included in the calculations on the statement of cash flows or shown in the notes?
(b) Explain your answer.
c5 Key
1. Which one of the following items is not generally used in preparing a statement of cash flows?
A. Comparative statements of financial position
B. Current income statement
C. Additional information
D. Adjusted trial balance
Difficulty: Medium
Gradable: automatic
Learning Objective: 1
Libby - Chapter 05 #1
2. Which of the following transactions would not create a cash flow?

A. The company purchased some of its own shares from a shareholder.
B. Amortization of patent for the period.
C. Payment of a cash dividend.
D. Sale of equipment at book value (i.e. no gain or loss).
Difficulty: Medium
Gradable: automatic
3. Which of the following transactions is not a direct source of cash?

A. Disposal of inventory for cash.
B. Borrowing cash.
C. Sale and issuance of shares for cash.
D. Sale of services on credit.
Difficulty: Easy
Gradable: automatic
4. Which of the following transactions is not a direct use of cash?
A. Acquisition of inventory for cash.
B. Purchase of treasury shares with cash.
C. Exchanges of bonds payable for land.
D. Cash dividend paid.
Difficulty: Medium
Gradable: automatic
5. How should the statement of cash flows be dated?

A. December 31, 20X.
B. At Year-End December 31, 20X.
C. For the Year Ended December 31, 20X.
D. At December 31, 20X.
Difficulty: Easy
Gradable: automatic
6. The category that is generally considered to be the best measure of a company's ability to continue as a going
concern is
A. cash flows from investing activities.
B. cash flows from financing activities.
C. cash flows from operating activities.
D. usually different from year to year.
Difficulty: Easy
Gradable: automatic
7. Which of the following transactions is not a typical use of cash?

A. Payment of short-term debt with cash.
B. Purchase of treasury shares for cash.
C. Acquisition of a building for cash.
D. Sale of equipment for less than book value.
Difficulty: Easy
Gradable: automatic
8. Which of the following would not be a cash flow from investing activities?
A. Purchase of long-term investments.
B. Sale of a patent.
C. Collection of principal of a note receivable.
D. Collection of interest revenue on a long-term note.
Difficulty: Medium
Gradable: automatic
9. Which of the following would not be a cash flow from financing activities?
A. Issuance of common shares.
B. Borrowing on a long-term note payable.
C. Repayment of principal on a long-term note payable.
D. Collection of a cash dividend.
Difficulty: Medium
Gradable: automatic
10. Which of the following is a cash flow from operating activities?

A. Purchase of merchandise for resale.
B. Sale of a piece of land no longer used in operations.
C. Sale of long-term investments in common shares.
D. Payment of a note payable.
Difficulty: Medium
Gradable: automatic
11. Which of the following would not be a cash equivalent?

A. A $10,000, 30 day certificate of deposit.
B. 500 shares of RIM shares.
C. A three-month Treasury bill.
D. A ten-year Treasury note purchased two months before maturity.
Difficulty: Medium
Gradable: automatic
12. Which of the following is a cash inflow from financing activities?
A. proceeds from selling investments in equity securities of another company.
B. proceeds from selling equipment.
C. proceeds from issuance of bonds payable.
D. receipt of interest payments.
Difficulty: Easy
Gradable: automatic
13. For an investment to qualify as a cash equivalent, it must be readily convertible to a known amount of cash
and which of the following?
A. it must be identified as a cash equivalent on the income statement.
B. it must mature within 4 months.
C. the investment must have a known foreign exchange rate.
D. must be sufficiently close to its maturity date so that its market value is relatively insensitive to interest rate
changes.
Difficulty: Medium
Gradable: automatic
14. A cash inflow from operating activities includes which of the following?
A. collection of the principal of a loan.
B. collection of sales price of equipment used in operations of the business.
C. proceeds from issuance of notes payable.
D. receipt of interest on an investment.
Difficulty: Easy
Gradable: automatic
15. Which of the following statements about the statement of cash flows is correct?
A. A company with a net loss on the income statement will always have a net cash outflow from operating
activities.
B. A purchase of equipment is classified as a cash inflow from investing activities.
C. Cash dividends received on equity investments are classified as cash flows from operating activities.
D. Cash dividends paid are classified as cash flows from operating activities.
Difficulty: Medium
Gradable: automatic
16. Which of the following items about the statement of cash flows is correct?
A. Noncash expenses such as depreciation are deducted from profit with the indirect method in computing cash
B. Cash equivalents are highly liquid investments with maturities at the date of purchase of less than three
months.
C. The acquisition of land by issuing bonds payable would not appear on the statement of cash flows.
D. Cash paid for interest would be classified as a financing cash flow.
Difficulty: Medium
Gradable: automatic
17. Which of the following statements about the statement is correct?

A. The sale of an investment in bonds for less than the carrying value of the investment would be reported as
cash outflow from financing activities.
B. The sale and issuance of common shares for cash would be reported as a cash inflow from financing
activities.
C. The retirement of bonds payable by the issuance of common shares would be reported as a cash inflow from
investing activities.
D. Collecting cash interest revenue on a note receivable would be reported as a cash inflow from investing
activities.
Difficulty: Medium
Gradable: automatic
18. Toga Corporation reported profit of $50,000 for the year. During the year, trade receivables increased by
$8,000, trade payables decreased by $4,000 and depreciation expense of $6,000 was recorded. Net cash
provided by operating activities for the year, using the indirect method, is
A. $54,000.
B. $44,000.
C. $56,000.
D. $50,000.
Calculation: $50,000-8,000-4,000 + 6,000 = $44,000
Difficulty: Medium
Gradable: automatic
19. Winn Company's 20B income statement reported total revenues, $110,000, and total expenses (including
$10,000 depreciation), $70,000 (i.e., a profit of $40,000). The 20B balance sheet reported the following: trade
receivables--beginning balance, $16,000 and ending balance, $14,000; wages payable--beginning balance,
$2,000 and ending balance, $1,500. Therefore, based only on this information, the 20B net cash inflow from
operating activities was which of the following?
A. $48,500.
B. $50,000.
C. $51,500.
D. $59,500.
Calculation: $40,000 + 10,000 + 2,000-500 = $51,500
Difficulty: Hard
Gradable: automatic
20. Jackson Company gathered the following data to prepare its 20B statement of cash flows:
Based only on the above data, the net cash inflow from operating activities during 20B was which of the
following?
A. $43,000.
B. $45,000.
C. $51,000.
D. $53,000.
Calculation: $40,000 + 5,000 + 3,000 + 4,000 + 1,000-2,000 = $51,000
Difficulty: Medium
Gradable: automatic
21. Matlock Company reported total sales revenue of $55,000 and total expenses amounting to $45,000 (i.e.,
profit of $10,000) on its income statement for the year ended December 31, 20B. During 20B, trade receivables
decreased by $4,000, merchandise inventory decreased by $6,000, trade payables increased by $2,000 and
depreciation of $8,000 was recorded. Therefore, based only on this information, the net cash flow from
operating activities for 20B was which of the following?
A. $10,000.
B. $18,000.
C. $19,000.
D. $30,000.
Calculation: $10,000 + 4,000 + 6,000 + 2,000 + 8,000 = $30,000
Difficulty: Medium
Gradable: automatic
22. Allen Company reported total sales revenue of $150,000 and total expenses of $152,000 (i.e., a net loss of
$2,000) for the year ended December 31, 20D. During 20D, trade receivables decreased by $1,000, trade
payables increased by $5,000, wages payable increased by $3,000, and $18,000 in depreciation expense was
recorded. Assuming no other adjustments are needed, what was the "net cash flow from operating activities" for
20D (parentheses indicate net cash outflow)?
A. ($1,000).
B. $23,000.
C. $25,000.
D. $29,000.
Calculation: ($2,000) + 1,000 + 5,000 + 3,000 + 18,000 = $25,000
Difficulty: Medium
Gradable: automatic
23. Assume the 20D income statement reported total sales revenue of $160,000. The 20C-20D, comparative
statements of financial position showed that trade receivables increased by $10,000. What was the "cash inflow
from customers" for 20D?
A. $140,000.
B. $150,000.
C. $160,000.
D. $170,000.
Calculation: $160,000-10,000 = $150,000
Difficulty: Medium
Gradable: automatic
24. Restless Company's 20B income statement reported total sales revenue of $100,000. The 20A-20B,
comparative statements of financial position showed that trade receivables decreased by $10,000. What were
the 20B "cash receipts from customers"?
A. $80,000.
B. $90,000.
C. $100,000.
D. $110,000.
Calculation: $100,000 + 10,000 = $110,000
Difficulty: Medium
Gradable: automatic
25. WT Company reported sales revenue of $100,000 and total expenses of $90,000 (including depreciation) for
the year ended December 31, 20A. During 20A, trade receivables decreased by $4,000, merchandise inventory
increased by $3,000, trade payables increased by $2,000, and depreciation expense of $6,000 was recorded.
Assuming no other data are needed, what was the net cash inflow from operating activities for 20A?
A. $19,000.
B. $20,000.
C. $21,000.
D. $24,000.
Calculation: $10,000 + 6,000 + 4,000-3,000 + 2,000 = $19,000
Difficulty: Medium
Gradable: automatic
26. Trade receivables arising from sales to customers amounted to $35,000 and $40,000 at the beginning and
end of the year, respectively. Profit reported on the income statement for the year was $120,000. Exclusive of
the effect of other adjustments, the cash flows from operating activities, prepared using the indirect method, is
A. $120,000.
B. $155,000.
C. $115,000.
D. $125,000.
Calculation: $120,000 - $5,000 = $115,000
Difficulty: Medium
Gradable: automatic
27. ABC Company reported total sales revenue of $80,000 and total expenses of $72,000 (i.e., profit of $8,000)
for the year ended December 31, 20X. During 20X, trade receivables increased by $3,000, merchandise
inventory decreased by $2,000, trade payables increased by $1,000, and $5,000 in depreciation expense was
recorded. Assuming no other adjustments to profit are needed, what was the net cash inflow from operating
activities?
A. $10,000.
B. $11,000.
C. $13,000.
D. $19,000.
Calculation: $8,000-3,000 + 2,000 + 1,000 + 5,000 = $13,000
Difficulty: Medium
Gradable: automatic
28. The statement of cash flows (indirect method) reports depreciation expense as an addition to profit because
depreciation does which of the following?
A. causes an inflow of funds for the replacement of assets.
B. reduces reported profit of the period but does not involve an outflow of cash for that period.
C. is a direct use of cash.
D. reduces reported profit and causes an inflow of cash.
Difficulty: Medium
Gradable: automatic
29. To prepare a statement of cash flows (indirect method), which of the following items should be added back
to profit to derive "cash flow from operating activities"?
A. Depreciation expense.
B. Increase in trade receivables.
C. Gain on a sale of equipment.
D. Decrease in trade payables.
Difficulty: Medium
Gradable: automatic
30. Travis Company reported a profit for 20B of $20,000, building depreciation expense of $6,000, and
amortization expense (patent) of $5,000. Also, trade payables increased by $7,000 and inventory decreased by
$2,000. What was the amount of "cash flows from operating activities" for 20B?
A. $34,000.
B. $35,000.
C. $36,000.
D. $40,000.
Calculation: $20,000 + 6,000 + 5,000 + 7,000 + 2,000 = $40,000
Difficulty: Medium
Gradable: automatic
31. The 20B income statement of Dunn Company reported total sales revenue of $106,000 and total expenses of
$108,000 (i.e., net loss, $2,000). Expenses were: building depreciation, $10,000 and patent amortization,
$5,000. There was an increase in inventory of $1,000. What was cash flow from operating activities during 20B
(parentheses indicate outflow)?
A. ($3,000).
B. $7,000.
C. $12,000.
D. $14,000.
Calculation: ($2,000) + 10,000 + 5,000-1,000 = $12,000
Difficulty: Medium
Gradable: automatic
32. Which of the following is not true of the direct method of preparing a statement of cash flows?
A. it gives the user a sense of the magnitude of gross dollars flowing in and out of the company.
B. it has the same cash flows from investing and financing activities as the indirect method.
C. it has a different net cash inflow (outflow) from operating activities than the indirect method.
D. it reports the same net increase or decrease in cash as the indirect method.
Difficulty: Medium
Gradable: automatic
33. The financial statements for Ozzie Company show the following:
How much cash was paid for merchandise?

A. $117,000.
B. $119,000.
C. $121,000.
D. $124,000.
Calculation: $121,000 + 1,000-3,000 = $119,000
Difficulty: Medium
Gradable: automatic
34. The 20B income statement for Ryan Corporation showed the following:
What was the cash flow from operating activities?

A. $66,000.
B. $70,000.
C. $82,000.
D. $86,000.
Calculation: $81,000 + 8,000-5,000 + 2,000 = $86,000
Difficulty: Medium
Gradable: automatic
35. Which statement regarding the indirect method is false?
A. Depreciation expense is added back to profit.
B. An increase in trade receivables is added to profit.
C. An increase in trade payables is added to profit.
D. An increase in merchandise inventory is subtracted from profit.
Difficulty: Medium
Gradable: automatic
36. The financial statements of Juliet Company show the following:
How much cash was collected from customers?

A. $148,000.
B. $150,000.
C. $154,000.
D. $160,000.
Calculation: $154,000 + 6,000 = $160,000
Difficulty: Medium
Gradable: automatic
37. Which of the following statements about cash flows from operating activities, in a statement of cash flows
prepared under the indirect method, is correct?
A. An increase in trade receivables would be subtracted from profit.
B. An increase in salaries payable would be subtracted from profit.
C. An increase in inventory would be added to profit.
D. Depreciation expense would be subtracted from profit.
Difficulty: Medium
Gradable: automatic
38. Which of the following statements about the quality of earnings ratio is true?
A. When sales are growing, receivables and inventory normally increase faster than trade payable so the ratio
increases.
B. Seasonal variations in sales have no impact on the quality of income ratio.
C. Failure to accrue appropriate expenses will inflate profit and reduce the quality of income ratio.
D. Failure to accrue appropriate expenses will inflate net profit and increase the quality of income ratio.
Difficulty: Hard
Gradable: automatic
39. Which of the following statements about the quality of earnings ratio is false?
A. An increase in operating assets and a decrease in liabilities will reduce operating cash flows, thereby
reducing the ratio.
B. Seasonal variations in sales and purchases of inventory can cause wide deviations in the quality of earnings
ratio.
C. When sales are growing, receivables and inventory normally increase at a faster rate than trade payables
often causing operating cash flows to be less than profit.
D. Seasonal variations in sales have no impact on the quality of earnings ratio.
Difficulty: Medium
Gradable: automatic
40. In 2012, The W D Company reported profit of $1.3 billion and cash flow from operations of $5.6 billion. In
2011, it profit was $1.9 billion and cash flow from operations was $5.1 billion. What were their quality of
income ratios for 2012 and 2011 respectively?
A. .23 and .37
B. .91 and 1.46
C. 1.10 and .68
D. 4.31 and 2.68
Calculation: $5.6/1.3; $5.1/1.9
Difficulty: Hard
Gradable: automatic
41. In 2012, C Co. reported a quality of earnings ratio of 1.60. In 2011 and 2010 the ratio was .97 and .98
respectively. Which of the following was the most likely cause of the large increase in the ratio?
A. An increase in current assets such as receivables and inventory.
B. An increase in trade payables and accrued liabilities.
C. An increase in sales revenue while profit remained the same.
D. None of these is a likely cause.
Difficulty: Hard
Gradable: automatic
42. If a loss of $20,000 is incurred in selling (for cash) office equipment that cost $90,000 and had accumulated
depreciation of $22,500, the total amount reported in the investing activities section of the statement of cash
flows is
A. $70,000.
B. $67,500.
C. $47,500.
D. $87,500.
Calculation: $90,000-22,500-20,000 = $47,500
Difficulty: Medium
Gradable: automatic
43. Typical financing activities do NOT include the following:

A. Proceeds from issuance of short- and long-term borrowings.
B. Principal payments on short- and long-term borrowings.
C. Purchase of short- or long-term investments for cash.
D. Purchase of shares for retirement.
Difficulty: Medium
Gradable: automatic
44. In 2012, C Co. disclosed cash paid for property, plant and equipment of $1.069 million and cash flow from
operations of $3.883 million. Their average property, plant and equipment from the comparative statement of
financial position was $3.968 million. Compute C Co.'s capital acquisitions ratio for 2012.
A. .28
B. .77
C. .98
D. 3.63
Calculation: 3.883/1.069 = 3.63
Difficulty: Medium
Gradable: automatic
45. In the years 2005-2008, B Co.'s capital acquisitions ratio was 2.74 and from 2009-2012, it was 1.24. From
2009-2012, R Co.'s ratio was .30. Which of the following statements about B Co.'s capital acquisitions ratio is
correct?
A. B Co.'s capital acquisitions ratio is relatively low and indicates inability to finance property, plant and
equipment with cash flow from operations.
B. It appears that R Co. is more aggressive about investing in additional property, plant and equipment than is B
Co.
C. B Co.'s ratio has improved in the period 2009-2012.
D. It appears that B Co. is more aggressive about investing in additional property, plant and equipment than is R
Co.
Difficulty: Hard
Gradable: automatic
46. Randy, Inc., issued $50,000 of bonds, paid cash dividends of $8,000, sold long-term investments for
$12,000, received $5,000 of dividend revenue, purchased treasury shares for $15,000, and purchased new
equipment for $19,000. What is the net cash flow from financing activities?
A. ($20,000).
B. $27,000.
C. $70,000.
D. $80,000.
Calculation: $50,000-8,000-15,000 = $27,000
Difficulty: Medium
Gradable: automatic
47. A company acquired some land (independently appraised at $12,000) and paid for it by issuing 1,000 shares
of its common shares (par $10 per share; no market price was quoted). How should this be reported on the
statement of cash flows?
A. Report $12,000 as inflow and outflow of cash.
B. Report $12,000 as an inflow of cash.
C. Should not be reported on the statement of cash flows.
D. Report on a schedule of significant noncash transactions if it is material.
Difficulty: Medium
Gradable: automatic
48. Lori Company sold an operational asset, a machine, for cash. It originally cost $20,000. The accumulated
depreciation at the date of disposal was $15,000. A gain on the disposal of $2,000 was reported. What was the
cash inflow from this transaction?
A. $3,000.
B. $4,000.
C. $5,000.
D. $7,000.
Calculation: ($20,000-15,000) + 2,000 = $7,000
Difficulty: Medium
Gradable: automatic
49. Nelson Company collected the following data in its accounting records in 20B:
No new equipment was purchased during the year. What was the cash inflow from the sale of equipment in
20B?
A. $600.
B. $900.
C. $1,000.
D. $3,900.
Calculation: ($12,500-8,000)-(2,000 + 1,000-2,400)-3,000 = $900
Difficulty: Hard
Gradable: automatic
50. The income statement, statement of financial position and statement of cash flows all are prepared on the
accrual basis.
FALSE
Difficulty: Easy
Gradable: automatic
51. The statement of cash flows and the statement of cash flows both report on the causes of the changes in the
cash of the business.
FALSE
Difficulty: Medium
Gradable: automatic
52. The net cash inflow or outflow for the year is the same amount as the increase or decrease in cash and cash
equivalents for the year.
TRUE
Difficulty: Medium
Gradable: automatic
53. The statement of cash flows is dated exactly like the income statement but unlike the statement of financial
position.
TRUE
Difficulty: Easy
Gradable: automatic
54. Short-term investments in marketable equity securities are considered the equivalent of cash (i.e., they are
combined with cash) in preparing the statement of cash flows.
FALSE
Difficulty: Medium
Gradable: automatic
55. Cash equivalents are highly liquid investments with original maturities of less than six months.
FALSE
Difficulty: Medium
Gradable: automatic
56. When the statement of cash flows is prepared in conformity with IFRS there is only one acceptable way to
measure and report cash flows from operating activities.
FALSE
Difficulty: Easy
Gradable: automatic
57. The net cash inflow (or outflow) from operating activities is computed by adjusting the reported accrual
profit for noncash revenue and noncash expense items.
TRUE
Difficulty: Medium
Gradable: automatic
58. If there is a change in cash, there will be a change in one or more noncash accounts.
TRUE
Difficulty: Medium
Gradable: automatic
59. When a cash dividend is paid, the cash outflow is classified as an operating activity.
FALSE
Difficulty: Medium
Gradable: automatic
60. Cash equivalents are defined as short-term, highly liquid investments that are readily convertible into known
amounts of cash and are so near their maturity that there is insignificant risk of changes in their value due to
interest rate changes.
TRUE
Difficulty: Medium
Gradable: automatic
61. The statement of cash flows is the only financial statement prepared on the cash basis of accounting rather
than on the accrual basis of accounting.
TRUE
Difficulty: Easy
Gradable: automatic
62. Only investments with original maturities of less than three months at the date of purchase qualify as cash
equivalents.
TRUE
Difficulty: Medium
Gradable: automatic
63. Cash collected from customers is a cash flow from a financing activity.
FALSE
Difficulty: Easy
Gradable: automatic
64. The amortization of a patent is treated in a similar manner to depreciation of a building when preparing the
operating activities section of the statement of cash flows using the indirect method.
TRUE
Difficulty: Medium
Gradable: automatic
65. The payment to shareholders for repurchase of treasury shares is a cash flow from a financing activity.
TRUE
Difficulty: Hard
Gradable: automatic
66. The payment of interest on a note payable is a cash flow from an operating activity.
TRUE
Difficulty: Medium
Gradable: automatic
67. Dividends collected from a long-term investment are cash flows from investing activities.
FALSE
Difficulty: Medium
Gradable: automatic
68. Collection of principal on a note receivable is a cash flow from investing activities.
TRUE
Difficulty: Medium
Gradable: automatic
69. Loans to other companies (notes receivable) are cash flows from investing activities.
TRUE
Difficulty: Medium
Gradable: automatic
70. The date in the heading of a statement of cash flows should say, "At December 31, 20A," rather than "For
the Year Ended December 31, 20A."
FALSE
Difficulty: Easy
Gradable: automatic
71. Very few companies use the direct method for disclosing their cash flows from operating activities.
TRUE
Difficulty: Easy
Gradable: automatic
72. The net increase (or decrease) in cash that is reported on the statement of cash flows should be the same as
the change in the balance of the cash account for the two most recent years on the comparative statements of
financial position.
TRUE
Difficulty: Easy
Gradable: automatic
73. The sales revenue reported on the income statement for 20A totaled $96,000, of which one third was on
credit. The 20A beginning balance of trade receivables was zero and the 20A ending balance reported on the
statement of financial position was $10,000; therefore, the 20A cash inflow from customer sales was $86,000.
TRUE
Calculation: $96,000-10,000 = $86,000
Difficulty: Medium
Gradable: automatic
74. Expenses reported on the income statement for 20A (the first year of operations), totaled $60,000, which
included depreciation expense of $8,000, and wages payable increased to $3,000 by the end of 20A. Therefore,
the 20A cash outflow for expenses was $71,000.
FALSE
Calculation: $60,000-8,000-3,000 = $49,000
Difficulty: Medium
Gradable: automatic
75. Depreciation expense does not cause a cash outflow for the current period; therefore, it should never be
shown on the statement of cash flows.
FALSE
Difficulty: Easy
Gradable: automatic
76. In order to prepare the statement of cash flows, the accountant must analyze current asset and current
liability balances.
TRUE
Difficulty: Medium
Gradable: automatic
77. The indirect method for reporting cash flows from operating activities presents a conversion of profit to net
cash flow from operating activities.
TRUE
Difficulty: Easy
Gradable: automatic
78. Depreciation expense has the immediate effect of increasing the cash account.
FALSE
Difficulty: Medium
Gradable: automatic
79. Increases in current liabilities are added to profit while decreases in current liabilities are subtracted from
profit to derive the net cash flows.
TRUE
Difficulty: Medium
Gradable: automatic
80. The quality of earnings ratio (Cash Flow from Operating Activities ¸ Profit) measures the portion of profit
that was generated in cash.
TRUE
Difficulty: Easy
Gradable: automatic
81. Investing activities include cash proceeds from the sale of property, plant, and equipment, and short- and
long-term investments.
TRUE
Difficulty: Medium
Gradable: automatic
82. A higher quality of earnings ratio indicates that it is less likely that the company is using aggressive revenue
recognition policies to increase profit.
TRUE
Difficulty: Hard
Gradable: automatic
83. Investing activities reported on the statement of cash flows include cash payments to acquire property, plant,
and equipment, and short- and long-term investments.
TRUE
Difficulty: Medium
Gradable: automatic
84. The capital acquisitions ratio (Cash Flow from Operating Activities ¸ Cash Paid for Property, Plant, and
Equipment) reflects the portion of purchases of property, plant, and equipment financed from operating
activities without the need for outside debt or equity financing or the sale of other investments or other
long-term assets.
TRUE
Difficulty: Medium
Gradable: automatic
85. A low capital acquisitions ratio indicates a higher need to obtain outside financing to expand property, plant,
and equipment assets.
TRUE
Difficulty: Easy
Gradable: automatic
86. Cash payments associated with interest relate to operating activities.
TRUE
Difficulty: Easy
Gradable: automatic
87. Non-cash investing and financing activities are disclosed only as supplemental disclosures to the statement
of cash flows in either narrative or schedule form.
TRUE
Difficulty: Medium
Gradable: automatic
88. Wish Corporation acquired a computer for $15,000 and paid for it in full by issuing 1,000 shares of its own
common shares, par $10 (current market price $15 share). This transaction should not be reported on the
statement of cash flows because cash was neither paid out nor received.
TRUE
Difficulty: Medium
Gradable: automatic
89. A transaction that does not cause an inflow or outflow of cash should be reported on the statement of cash
flows only if it is an adjustment to convert accrual profit to the cash basis.
FALSE
Difficulty: Medium
Gradable: automatic
90. The purchase of a piece of equipment in exchange for common shares must be reported on the statement of
cash flows.
FALSE
Difficulty: Medium
Gradable: automatic
91. Billton Company purchased a machine in the current year for $18,000. Payment included cash, $5,000; a
one-year note payable, $5,000; and a 2-year, $8,000 note payable. This decreases cash by $5,000 in the current
year.
TRUE
Difficulty: Medium
Gradable: automatic
92. When using the indirect method, a loss on the sale of equipment should be added to profit to derive cash
TRUE
Difficulty: Medium
Gradable: automatic
Learning Objective: 2; 4
93. Match each activity below with the proper classification by inserting the proper capital letter in the space to
the left.
Classification of Activity
I. Investing
F. Financing
O. Operating
Activity
____ 1. Collection of interest on a note receivable.

____ 2. Payment of debt principal with cash.
____ 3. Sales of operational assets (used in the business).
____ 4. Payment of cash dividends.
____ 5. Issuance of shares for cash.
____ 6. Borrowing cash from the bank.
____ 7. Purchase of operational assets for cash.
____ 8. Collections of dividends on long-term investments.
(1) O, (2) F, (3) I, (4) F, (5) F, (6) F, (7) I, (8) O
Difficulty: Medium
Gradable: manual
94. Indicate the proper classification for each of the transactions by inserting the proper letter in the space to the
left.
Classifications
A. Operating Activities
B. Investing Activities
C. Financing Activities
D. Schedule of non-cash transactions
E. Not included in the statement of cash flows
Transaction
____ 1. Declared a cash dividend.

____ 2. Paid a previously declared cash dividend.
____ 3. Issued shares for a new machine.
____ 4. Borrowed cash on a short-term note.
____ 5. Borrowed cash on a long-term note.
____ 6. Purchased treasury shares for cash.
____ 7. Paid interest on a note payable.
____ 8. Purchased treasury shares and gave a long-term note payable.
____ 9. Purchased land with a short-term note payable.
___ 10. Purchased shares in another company.
___ 11. Purchased land for cash.
(1) E, (2) C, (3) D, (4) C, (5) C, (6) C, (7) A, (8) D, (9) D, (10) B, (11) B
Difficulty: Medium
Gradable: manual
95. For each of the following items, indicate whether they would appear in the operating, investing, or financing
activities section of the statement of cash flows. Place a check mark in the appropriate column for each
transaction. If neither an operating, investing, or financing activity is appropriate, place a check mark in the
"none" column. Assume the indirect method is used for reporting.
Difficulty: Medium
Gradable: manual
96. Using the indirect method, calculate the amount of cash flows from operating activities from the following
data:
Difficulty: Hard
Gradable: manual
97. The comparative statements of financial position for Hirj Inc. appear below:
Additional information:
1. Profit for the year ending December 31, 2012 was $27,000.
2. Cash dividends of $13,000 were declared and paid during the year ended December 31, 2012.
3. Long-term investments that had a carrying amount of $23,000 were sold for $18,000 in 2012.
Required: Prepare a statement of cash flows for the year ended December 31, 2012, using the indirect method.
Difficulty: Hard
Gradable: manual
98. Use the following information to prepare a statement of cash flows (direct method) for Yoyo Corporation
for the year ended December 31, 20B.
Schedule of Noncash Investing and Financing Activities:

The company sold equipment and accepted a note for $10,000.
Difficulty: Easy
Gradable: manual
99. Morgan Company is preparing a statement of cash flows using the indirect method. The following data are
available:
$30,000 + $18,000 - $5,000 - $10,000 + $10,000 - $7,000 = $36,000
Difficulty: Medium
Gradable: manual
100. Reba Company reported profit of $10,000 for 20A. Additional 20A information is as follows:
Based on the information given above, the statement of cash flows would show "cash flows from operating
activities" of $______________
$10,000 + $2,000 + $400 + $200 + $100 + $300 = $13,000
Difficulty: Medium
Gradable: manual
101. McIntire Company reported profit of $40,000 which included depreciation expense and depletion expense
of $21,000 and $18,000, respectively. The following changes also occurred during 20C
The amount of "cash flows from operating activities" was $______________
$40,000 + $21,000 + $18,000 + $10,000 + $5,000 + $7,000 - $10,000 = $91,000
Difficulty: Medium
Gradable: manual
102. Complete the following statement of cash flows using the indirect method:
Difficulty: Medium
Gradable: manual
103.
The following changes were noted from the statement of financial position: trade receivables increased $8,000;
inventory increased $4,000; trade payables increased $6,000; prepaid expense decreased $2,000; accrued
liability decreased $5,000; and interest payable increased $1,000
Required: Prepare the operating activities section of the statement of cash flows using the indirect method.
Difficulty: Medium
Gradable: manual
104. The following information was reported from the statement of cash flows for The W D Company for the
years 2010 through 2012 in millions of dollars:
A. Calculate the quality of income ratio for the years 2010 through 2012.
B. Interpret the quality of earnings ratio for The W D Company for the three year period.
(A) (1) 4.30, (2) 2.76, (3) 2.59.

(B) The W D Company had a strong quality of income ratio for all three years. They were able to generate
positive cash flow from a low of $2.59 for every dollar in net income earned to a high of $4.30 of cash for every
dollar of profit. The ratio took a big jump in 2012 primarily caused by an increase in cash flow from operations
and a decrease in profit of over a half billion dollars. The change in profit was the major influence on the
increase in the quality of earnings ratio.
Difficulty: Hard
Gradable: manual
105. C Co. reported the following information from their statement of cash flows in millions of dollars:
(A) Calculate the quality of income ratio for C Co for the three years:
(B) In 2011, P Co. reported a quality of earnings ratio of 1.61. Compare C Co.'s quality of earnings ratio for that
year to their competitor's ratio.
(A) (1) 1.60, (2) .97, (3) .98.

(B) In 2011, C Co.'s quality of earnings ratio was .97 compared to P Co's ratio of 1.61. C Co.'s ratio was much
lower but it was still close to a ratio of one, so overall its ratio was adequate. P Co.'s ratio showed their ability to
generate better cash flow from their earnings than did C Co.; however, by 2012, it appears as if C Co.'s ratio has
improved and is in line with P Co's 2011 ratio.
Difficulty: Medium
Gradable: manual
106. The following information was available from the financial statements of C Co. Company for the years
2011 and 2012 in millions of dollars:
A. Calculate the capital acquisitions ratio for C Co. for the two years:
B. Comment on the sufficiency of the capital acquisitions ratio for the two years.
(A) (1) 3.63, (2) 3.98.

(B) The ratio appears to be sufficient in both years. C Co. is generating $3.63 of cash flow from operations for
every $1 they are investing in new plant and equipment as of 2012. This indicates they do not need to borrow or
issue shares to secure external financing for their expansion of plant and equipment assets.
Difficulty: Medium
Gradable: manual
107. The following information is provided from the cash flow statement for Toys 4 U for the years 2008
through 2012 in millions of dollars:
(A) Calculate the capital acquisitions ratio for Toys 4 U for the five year period from 2008 to 2020.
(B) Comment on the capital acquisitions ratio for Toys 4 U for the five years.
(A) (1) 2.58, (2) 1.03, (3) 1.79, (4) .53, (5) 1.01.
(B) The capital acquisitions ratio for Toys 4 U has been erratic over the five years ranging from a low of .53 to a
high of 2.58. During the five years from 2008 to 2012, the company had been investing between $586 million to
$373 million in property, plant and equipment. However, their cash flow from operations was very erratic
ranging from a high of $964 million in 2012 to a low of $250 million in 2009. The ratio has been affected not
only by the level of investments in these long-lived assets, but by the erratic inflow of cash from operations. In
2012, the ratio was at its highest point at 2.58 caused by a decrease in the level of investment, $373 million,
while cash inflow was at its peak of $964 million.
Difficulty: Medium
Gradable: manual
108. While preparing a statement of cash flow, you encountered the following transaction:
February 1, 20A: Zorro Corporation acquired a small office building in exchange for 5,000 shares of its own
common shares; par value $10 per share; market value $15 per share.
(a) Should this transaction be included in the calculations on the statement of cash flows or shown in the notes?
(b) Explain your answer.
(a) Notes
(b) Because it is a direct exchange, it is reported on the statement of cash flows in the Schedule of Non-cash
Investing and Financing Transactions as "Office building, acquired for 5,000 shares of Zorro's common shares,
$75,000."
Difficulty: Medium
Gradable: manual
c5 Summary
Category # of Questions
Difficulty: Easy 20
Difficulty: Hard 11
Difficulty: Medium 77
Gradable: automatic 92
Gradable: manual 16
Learning Objective: 1 51
Learning Objective: 2; 4 1
Libby - Chapter 05 108
Another random document with
no related content on Scribd:
“Travelers may make good use of this volume, and it may be
commended to public-school geography classes.”
+ R of Rs 61:221 F ’20 140w

The Times [London] Lit Sup p244 Ap
15 ’20 70w
JOHNSON, ROBERT UNDERWOOD.

Collected poems, 1881–1919. *$4 Yale univ. press 811
20–1009
The collection comprises the poet’s former volumes together with

some new material. The contents are: The winter hour, and other
poems; Songs of liberty, and other poems; Italian rhapsody, and
other poems; Moments of Italy, and other poems; Saint-Gaudens: an
ode; Later poems of occasion; Poems of war and peace; Poems of the
great war; Poems chiefly of friendship or admiration; Later poems of
the great war; Miscellaneous poems; Poems of Italy in war-time;
Latest war-time poems.
“Many of his poems are occasional in character, and in these he

displays his happiest inspiration. He has the professional after-
dinner speaker’s talent for saying the right, the tactful thing about
any person or event. Mr Johnson would make an excellent laureate.”
+ Ath p622 My 7 ’20 120w

“There is much sweetness—which never descends to mere
prettiness—much grace and a good deal of fine thought finely
expressed in melodious verse. Mr Johnson has long and deservedly
enjoyed a special place of distinction in modern American poetry of
the conservative tradition.” H: A. Lappin
+ Bookm 51:214 Ap ’20 60w
“To enjoy this volume you do not need to belong to any ‘school,’
nor to hold any poetic theory. All you need is to love poetry as the
interpreter of the best things in nature and life.” H: Van Dyke
+ Boston Transcript p6 F 14 ’20 1900w
“All the poems are not of equal value. But the omnipresent dignity
of Dr Johnson’s muse, his understanding love for Italy, and his
unfailing respect both for his medium and his reader, bespeak alike
the scholar and the citizen of the world.”
+ − Cath World 111:700 Ag ’20 150w

The Times [London] Lit Sup p215 Ap 1
’20 60w
JOHNSON, STANLEY CURRIE. Medal

collector. (Collector’s ser.) il *$2.50 Dodd 737
The book furnishes a guide to naval, military, air-force and civil

medals and ribbons in the following order: The pioneer medals of
England; Early medals of the Hon. East India Co.; Peninsular
awards; Waterloo awards; The naval general service medal;
Campaign medals; British orders and their insignia; The Victoria
cross; Service medals for bravery, etc.; Commemorative medals;
Medals for long service, good conduct, etc.; Regimental medals; Civil
medals; Medals of the United States; Foreign awards. The book
contains eight plates in color and numerous other illustrations and
has appendices, a bibliography and index.
JOHNSON, STANLEY CURRIE. Stamp

collector; a guide to the world’s postage stamps.
(Collector’s ser.) il *$2.50 (3½c) Dodd 383
The author rates the hobby of stamp collecting highly from an

intellectual, an economic and a commercial point of view, but first
and foremost as a pastime full of charm and fascination. Since there
is so much that can be collected and so much that ought not to be
collected he offers this guide which equally satisfies the beginner and
the more advanced collector. The first few chapters deal with
philately on general terms. They are: Planning and arranging the
collection; Specialised collections; Technical matters; Stamps,
desirable and otherwise; Forged and faked stamps; Sir Rowland Hill
and other pioneers. Then a number of chapters are devoted to a
description of stamps of definite areas and the last four are: The
stamps of war; Rare stamps; Philately for the young; A glossary of
philatelic terms with a bibliography and an index.
“If the author’s line of demarcation between stamps desirable and

otherwise is rather arbitrary, his advice as to the best method of
forming and continuing a stamp collection is at least accurate.”
+ − The Times [London] Lit Sup p10 Ja 1

’20 550w
JOHNSON, THOMAS COSTELLO. Irish tangle
and a way out. *$1.50 Gorham 941.5
20–5597
“Mr Johnson is an American clergyman (Church of the Holy Spirit,

Bensonhurst, Brooklyn, N.Y.) who went to Ireland in 1918 to give
lectures about America’s part in the great war. The larger part of the
book is historical—from early times to recent developments. Mr
Johnson’s own solution is—with educational reform and the
development of resources—federal government with parliaments for
England, Ireland, Scotland, and Wales, and a central parliament at
Westminster.”—The Times [London] Lit Sup
Reviewed by Preserved Smith
Nation 110:556 Ap 24 ’20 280w

The Times [London] Lit Sup p191 Mr
18 ’20 100w
JOHNSON, WILLIS FLETCHER. History of

Cuba. 5v il $45 B. F. Buck & co., inc., 156 5th av., N.Y.
972.91
20–10078
“Taking San Salvador as his point of departure, the writer follows

the narrative of the discoverer, in which he traces his course from
one island to another, and by this means identifies the place of
landing of Columbus on the shores of Cuba. Thus is begun the
history of the island. With the fourth chapter, Dr Johnson abandons
travel for science, and enters upon geological and topographical
history of the great island. Dr Johnson traces the history of the early
years of Spanish settlement in Cuba, with great particularity down to
the close of the sixteenth century.... Subsequent passages relate the
military operations of an expedition under Admiral Vernon and the
British plans for the conquest of Spanish America, the attack upon
Havana and its capture; and finally, the negotiations which resulted
in the return of the island to Spain. The story follows of the American
war for independence and the rise of the Republic of the United
States and its influence upon Cuban affairs.... The fifth and final
volume of the series is concerned with the natural resources of Cuba
today. This volume has been compiled under the auspices of the
Cuban department of agriculture, commerce and labor.”—Boston
Transcript
“There seems to be no feature in Cuban history and character left

untouched in this scholarly and comprehensive presentation of a
subject until now neglected.” E. J. C.
+ Boston Transcript p6 Jl 14 ’20 1750w
“It is on the whole well proportioned. If this history were

condensed into a single volume it might serve a useful purpose. Its
faults would appear less glaring. But for the general reader it is too
long and costly, and as an accurately conceived and scholarly account
of Cuba it is simply a waste of good paper such as the trade at this
moment can ill afford.” C. H. Haring
− + N Y Evening Post p5 O 30 ’20 1550w

“Dr Johnson has looked at the facts, it may be said, from a Cuban
point of view, and at the same time with a sense of proportion that is
continental and international. He has produced not merely a
manifesto of Cuban patriotism, nor on the other hand, a coldly
detached compilation of facts, but a true national record. His work is
not only a valuable archive or work of reference, but also a treatise of
vital interest and importance to the people of this country.”
+ No Am 212:279 Ag ’20 2800w
“A well-written history.”
+ R of Rs 62:446 O ’20 20w
JOHNSTON, SIR HARRY HAMILTON. Mrs

Warren’s daughter; a story of the woman’s
movement. *$2 Macmillan
20–7923
“In his first novel, ‘The Gay-Dombeys,’ Sir Harry Johnston

undertook to show us the second generation, the descendants of
Walter Gay and Florence Dombey. Now he comes forward with ‘Mrs
Warren’s daughter,’ taking up the history of Vivie Warren and of her
mother at the point where George Bernard Shaw left it. When the
novel begins, Vivie and her friend Honoria Fraser compose the firm
of ‘Fraser & Warren, consultant actuaries and accountants.’ They are
doing very well, but find themselves perpetually hampered by the
regulations and laws forbidding women admission to various
professions. In a spirit of revolt against these man-made restrictions,
Vivie decides to cut her hair, don masculine apparel and become
David Vavasour Williams.... In 1910 she finally drops Mr David
Vavasour Williams and begins to take an extremely active part in the
militant suffragist movement.... Mrs Warren had taken up her
residence in Brussels, and that was how it came about that when
Vivie was released from prison during the first days of the world war
she went straight to Belgium to join her mother. The description of
the experiences of these two women especially during the months of
von Bissing’s ‘terror’ is very interesting and well done.”—N Y Times
“Whimsical, entertaining and clever. Readers who liked ‘The Gay

Dombeys’ will like this.”
+ Booklist 16:348 Jl ’20
“The incidents of the masculine masquerade partake more or less

of the nature of a fairy tale, but even though they are not credible,
they are delightful in their humor and their vigorous views of passing
phases of this world of English art, science and society. Nothing
human is alien to Sir Harry Johnston.” E. F. E.
+ Boston Transcript p8 My 29 ’20 2100w
“The single compelling section of the book is the middle one, in

which the effects of the Pankhurst leadership are given with
circumstantiality; but this is brief, and the rest falls away from it both
in matter and tone. It seems curious that Sir Harry could have found
so rich a pocket of ore and not have tried to mine it to the rock. ‘Mrs
Warren’s daughter’ is a too-simple sketch of a notable subject, and it
is nothing more.” C. M. R.
− + Freeman 1:597 S 1 ’20 280w

+ − Lit D p97 O 9 ’20 1700w
“In ‘The Gay-Dombeys’ there was the high gusto and boyish
delight of a gifted man’s successful experiment in a new form of
activity. His second book is notably less fresh and engaging.”
+ − Nation 110:950 Je 26 ’20 550w
“Those who knew the zoological, geographical, anthropological,

and other learned London societies some thirty or forty years ago will
read these books with a double interest, for they will find that Sir
Harry’s characters resuscitate past chapters in the history of
scientific life in London. The author, it is needless to say, uses a light
and nimble pen to draw word-pictures seen from a highly
individualistic Harry Johnstonian angle.”
+ Nature 106:339 N 11 ’20 360w
“Judged as a work of art the book fails. The structure is stumbling

and plodding: the style second-rate journalism. The characterization,
with the admirable exception of the redoubtable Mrs Warren herself
(she shows Sir Harry’s loving study of Dickens), is singularly
superficial and conventional.” S. C. C.
− + New Repub 23:157 Je 30 ’20 800w
“Unfortunately, it puts not its best but its worst foot foremost, the
poorest part of it being the first, in which occurs Vivie’s preposterous
masquerade. It is not until the last third of the book and its sixteenth
chapter are reached that the novel really begins to be distinctly
interesting. This sixteenth chapter is headed ‘Brussels and the war:
1914.’”
+ − N Y Times 25:280 My 30 ’20 1200w
“The interest is of a queer nature, but it certainly exists.”
+ Outlook 125:431 Je 30 ’20 140w
“‘Mrs Warren’s daughter’ by contrast [with ‘The Gay-Dombeys’] is

a laborious invention.” H. W. Boynton
− Review 3:709 Jl 7 ’20 300w
“We move in an atmosphere of sentimental romance, by no means

disagreeable, but miles apart from everything which we associate
with the initials G. B. S.”
+ − Sat R 129:456 My 15 ’20 450w
“On many matters of social interest he is fluent and furious, and

those who like this style of thing will doubtless be thrilled. We,
unfortunately, were unable to find anything like so many nice and
amusing people here as there were in ‘The Gay-Dombeys,’ and must
absolutely refuse to swallow Miss Warren.”
− + The Times [London] Lit Sup p200 Mr

25 ’20 580w
JOHNSTON, MARY. Sweet Rocket. *$1.65 (4c)
Harper
20–18509
The strain of mysticism revealed in Miss Johnston’s previous novel

is very evident in this book. Of story in the conventional sense there
is none. Richard Linden has returned to Sweet Rocket, the home of
his family before the war. Richard is blind, and Marget Land, who
had been born on the place as the overseer’s daughter, acts as his
secretary. There is a curious bond of unity between the two which
has no relation to earthly love and both are bound to Sweet Rocket
by deep spiritual ties. The spirit of the place is such that all who come
to it, friends or strangers, fall under its spell. There are beautiful
descriptions of the country alternating with discussions of a psychic
and spiritual nature.
Reviewed by H. W. Boynton
Bookm 52:342 Ja ’21 470w
“Miss Johnston has revealed with keen perception the idea of

individual growth and expansion toward Godhood, and the setting of
her book is of idyllic beauty.” F. M. W.
+ Boston Transcript p5 D 4 ’20 520w
“Though some of Miss Johnston’s readers may be pleased that

‘Sweet Rocket’ is written in the same mystical vein and in
furtherance of the same spiritual quest as ‘Foes’ and ‘Michael Forth,’
the majority will, at this third blow, relinquish with regrets the hope
that she may ever again give us a novel in the manner of ‘To have and
to hold.’”
− + N Y Evening Post p10 N 20 ’20 270w

N Y Times p21 N 21 ’20 400w
“It is not enough to be sensitive to the beautiful—one must have a

sense of relativity, of proportion. Miss Johnston here makes a too
conscious effort at poetic expression.”
− Springf’d Republican p8 D 10 ’20 250w
JOHNSTON, ROBERT MATTESON. First

reflections on the campaign of 1918. *$1.50 (11c) Holt
940.373
20–5656
The author, who was attached to the general staff at General

Pershing’s headquarters in France for twelve months, where he had
every opportunity of observing the working of our war machine,
offers his reflections as a “constructive criticism of our combat
army.” He points out the flaws, due to our neglect of national
preparedness, and how they can be avoided in the future. As he
foresees that the competition of highly organized industrial
communities, for markets and for raw material, is about to produce a
series of wars over the whole surface of the globe, he pleads for the
highest possible efficiency and combination of naval and military
power. Contents: The U.S. army before the war; Leavenworth; The
conduct of war; The rank and file; The regular officers; The national
army officer; The National guard officer; The general staff; General
Pershing; Tactics; The replacement system; Our army of the future.
Booklist 16:300 Je ’20

N Y Times p27 O 10 ’20 400w
R of Rs 61:558 My ’20 50w
JOHNSTON, WILLIAM ANDREW. Mystery in

the Ritsmore. il *$1.75 (3c) Little
20–10309
The murder of a beautiful girl in the hotel apartment of a newly

married couple takes place on the third day of their honeymoon. A
young guest at the hotel, Anne Blair, is drawn into the case by her
love of excitement. The mystery is apparently quickly solved by the
police, and they let the matter drop. But Anne is not convinced it is
so simple and, aided by John Rush, secretary to the millionaire,
Harrison Hardy, keeps up independent investigations of her own.
Her quest leads her into a maze of clues, which broaden out into a
plot of international significance, in which great sums of money are
involved. Although the plotters are clever, Anne Blair proves cleverer
in the end, when she foils their schemes.
+ Booklist 17:34 O ’20

“It is an excellent mystery tale. As is often true of detective stories,
the finale is something of a disappointment.”
+ − Boston Transcript p6 Jl 14 ’20 180w
“‘The mystery in the Ritsmore’ is an entertaining, ingenious and

well-told yarn, which holds its secret up to the very end.”
+ N Y Times 25:23 Jl 18 ’20 350w
“The story is episodical, but is well enough knit to interest.”
+ Springf’d Republican p11a Jl 18 ’20

130w
JONES, ELIAS HENRY. Road to En-Dor. il $2

(2c) Lane 940.47
20–7946
This book, “being an account of how two prisoners of war at

Yozgad in Turkey won their way to freedom,” (Sub-title), is
incidentally an exposé of spiritualism. The author, in conjunction
with a brother officer and prisoner, Lieutenant Hill, began his
experiments in spiritualism in good faith, but soon saw a possibility
of escape through skillful manipulations. They came to the
conclusion that spiritualism has a most deplorable effect even on
people whose mental powers one admires, causing them to lose hold
of the criteria of sane conclusions. “The messages we received from
‘the world beyond’ and ‘from other minds in this sphere’ were in
every case, and from beginning to end, of our own invention.” Yet
through them it was possible “to convert intelligent, scientific, and
otherwise highly educated men to spiritualism, by means of the arts
and methods employed by ‘mediums’ in general.” Although the
incidents described in the book may seem preposterous, the author
vows for their truthfulness. The book is illustrated by Lieutenant Hill
and has a postscript and appendices.
“To have made such an exposure at the present time is to have

done a real and lasting service.”
+ Ath p195 F 6 ’20 100w
“Interesting as a war narrative, though told somewhat too much in

detail. Also interesting propaganda for anti-spiritualists.”
+ − Booklist 16:308 Je ’20
“The book abounds in excellent and vigorous writing.”
+ N Y Times 25:28 Jl 4 ’20 430w
“The reader who begins ‘The road to En-Dor’ after dinner will
probably be found at one o’clock in the morning still reading.”
+ Spec 124:111 Ja 24 ’20 1700w

+ Springf’d Republican p11a Je 27 ’20
380w
JONES, SIR HENRY. Principles of citizenship.
*$1.25 Macmillan 320
20–12226
“This little book is intended for the use of such men as attended
the Y. M. C. A. lectures in the British army abroad. The purpose is to
give a general view of the duties and rights of citizens; and the
language is, therefore, simple and expressive. An initial distinction is
drawn between two conceptions of the state. The non-moral idea is
said to be German. Suggestions are then made as to the problem of
individuality which are held to refute the pacifist.”—Int J Ethics
“The author of this book is amiable and high-minded, but seems

out of place in the stern modern world, a belated Victorian.” B. R.
− + Ath p270 My 2 ’19 530w

Int J Ethics 30:115 O ’19 160w
“Must irritate any reader who really looks for some kind of serious
thought in Great Britain. Sir Henry Jones might quite decently have
left Hegel in his grave instead of serving him up to the Y. M. C. A. by
way of education for the British army. He ingeniously combines
several fallacies in one. In the first place, what he calls the state is
really the nation. In the second place, the ‘good life’ is no more the
object of one nation than another, and when a league of nations is in
being the ‘good life’ might be supposed to have an international
flavour about it. In the third place, no nation is worth its salt if the
forces of improvement do not originate with individuals but derive
their origin and impulse from politicians and bureaucrats.”
− Sat R 127:507 My 24 ’19 300w
“Sir Henry Jones has a firm grasp of moral principles, sadly

neglected or defied by many people nowadays, and his exposition of
his argument is singularly clear.”
+ Spec 124:355 Mr 13 ’20 200w
JONES, HENRY ARTHUR. Patriotism and

popular education. *$4 Dutton 370
20–10632
“‘Patriotism and popular education; with some thoughts upon

English work and English play, our evening amusements,
Shakespeare and the condition of our theatres, slang, children of the
stage, the training of actors, English politics before the war, national
training for national defence, war and design in nature, the league of
nations, the future world policy of America, capital and labour,
religion, reconstruction, the great commandments, social prophets
and social prophecy, competition and co-operation, the biologist and
the social reformer, hand labour and brain labour, school teachers
and rag-pickers, internationalism, and many other interesting
matters, in a letter to the Rt. Hon. H. A. L. Fisher, president of the
board of education.’ (Sub-title) The eminent playwright fully
describes his book on the title-page, and it remains only to add that
he pleads for practical education which would turn out good
carpenters and good citizens, and has no patience with modern ideas
that, as he considers, have put the majority of working-men ‘in open
rebellion against the plainest economic laws.’”—Ath
Ath p283 My 2 ’19 170w
− Ath p589 Jl 11 ’19 1100w
“Seems rather an outburst of annoyance than a constructively

thought out criticism.”
+ − Booklist 17:94 D ’20

Brooklyn 12:83 F ’20 40w
“As an experienced writer he can express himself vigorously in

from two to a dozen ways, can produce many interesting, many wise,
many suggestive, many amusing, and many provoking paragraphs.
But if one is looking for help in dealing with either educational
problems or the problems of state, he will find many smaller books
much more helpful.”
+ Nation 111:252 Ag 28 ’20 190w
“Suggestive as are Mr Jones’s opinions and arguments, stimulating

as they are and thought-provoking, they are calculated for the
meridian of Greenwich and not for that of Washington—which may
make them a little less useful to us, although none the less
entertaining.”
+ − N Y Times 24:389 Ag 3 ’19 2100w
“Throughout the book there are passages that deserve a praise that
cannot be accorded to the whole as a statement of first principles or
as a treatise upon education.”
+ − No Am 212:428 S ’20 1850w
“He can not write either lifelessly or tediously. He can not write
foolishly, either; and, although you may now and again disagree with
him, you will hardly find him repellently unsympathetic. On the
other hand, you may be apt to feel, he does not leave you much of
anywhere.”
+ − Review 3:111 Ag 4 ’20 500w

+ St Louis 18:56 Ap ’20 40w
“Mr Jones is in the mood of a man who has had a bad piece of
work palmed off on him and writes an indignant letter to the Times
about it. His book is a whole collection of indignant letters. The truth
is that Mr Jones has not thought out his arraignment.”
− Springf’d Republican p11a Jl 18 ’20

1100w
The Times [London] Lit Sup p183 Ap
17 ’19 540w
JONES, HERBERT. Well of being. *$1.50 Lane

821
20–7866
A book of poems composed of two parts, the first a series of love
sonnets, the second, “O mistress mine!” a long narrative poem telling
a story of youth and love in Vienna in the old light-hearted days of
that city.
Reviewed by R. M. Weaver
Bookm 52:63 S ’20 30w

Boston Transcript p4 My 26 ’20 200w
“Mr Jones writes love sonnets with ease and skill; sometimes with
a truly graceful aptness. Sometimes he drops to what is merely
trifling, or strikes a false note. The same may be said of the long
poem which fills the rest of the book.”
+ − The Times [London] Lit Sup p110 F 12

’20 120w
JONES, JOSHUA HENRY, jr. Heart of the

world. *$1.25 Stratford co. 811
19–16027
The title poem was inspired by the speech of President Wilson in

Boston on his first return from Europe in 1919. Among the other
titles are: The pine tree; The parting; With you away; In summer
twilight; Easter chimes; They’ve lynched a man in Dixie; Gone west;
The universe; A southern love song; The potter and his ware.
“Fortunately we are not compelled to judge Mr Jones poetically by
such a piece [the title poem]. With many another subject he is
happier in both conception and execution. He has a broad range of
interest and sympathies; has a discerning eye for nature and a warm
emotion for simple experiences and personal associations.” W. S. B.
+ − Boston Transcript p10 Ja 31 ’20 550w
JONES, RUFUS MATTHEW. Service of love in

war time. *$2.50 Macmillan 940.47
20–10376
“Rufus Jones’s ‘A service of love in war time’ is, as he says,

‘something more than the story of an impressive piece of relief work;
it is the interpretation of a way of life.’ It is the story of the Quakers
who found opportunity to express their pacifist convictions in
reconstruction service in France. Incidentally it is a record of our
War department’s methods in dealing with the conscientious
objectors. Indeed it is this record of the religious objectors in the
draft camps which is the most vivid part of Rufus Jones’s book—for
he was the chief representative of the Quakers in long and painful
negotiations with the military authorities. His account is a necessary
corollary to Captain Kellogg’s book on the conscientious objector.”—
Nation
“We commend this book to anyone who desires to read a story of

singular and effective devotion and courage.”

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2. Which of the following transactions would not create a cash flow?

3. Which of the following transactions is not a direct source of cash?

4. Which of the following transactions is not a direct use of cash?

5. How should the statement of cash flows be dated?

7. Which of the following transactions is not a typical use of cash?

10. Which of the following is a cash flow from operating activities?

11. Which of the following would not be a cash equivalent?

How much cash was paid for merchandise?

What was the cash flow from operating activities?

35. Which statement regarding the indirect method is false?

36. The financial statements of Juliet Company show the following:

How much cash was collected from customers?

86. Cash payments associated with interest relate to operating activities.

____ 1. Collection of interest on a note receivable.

____ 1. Declared a cash dividend.

The amount of "cash flows from operating activities" was $______________

2. Which of the following transactions would not create a cash flow?

3. Which of the following transactions is not a direct source of cash?

5. How should the statement of cash flows be dated?

7. Which of the following transactions is not a typical use of cash?

10. Which of the following is a cash flow from operating activities?

11. Which of the following would not be a cash equivalent?

17. Which of the following statements about the statement is correct?

Calculation: $50,000-8,000-4,000 + 6,000 = $44,000

Calculation: $40,000 + 10,000 + 2,000-500 = $51,500

Calculation: $40,000 + 5,000 + 3,000 + 4,000 + 1,000-2,000 = $51,000

Calculation: $10,000 + 4,000 + 6,000 + 2,000 + 8,000 = $30,000

Calculation: ($2,000) + 1,000 + 5,000 + 3,000 + 18,000 = $25,000

Calculation: $160,000-10,000 = $150,000

Calculation: $100,000 + 10,000 = $110,000

Calculation: $10,000 + 6,000 + 4,000-3,000 + 2,000 = $19,000

Calculation: $120,000 - $5,000 = $115,000

Calculation: $8,000-3,000 + 2,000 + 1,000 + 5,000 = $13,000

Calculation: $20,000 + 6,000 + 5,000 + 7,000 + 2,000 = $40,000

Calculation: ($2,000) + 10,000 + 5,000-1,000 = $12,000

How much cash was paid for merchandise?

Calculation: $121,000 + 1,000-3,000 = $119,000

What was the cash flow from operating activities?

Calculation: $81,000 + 8,000-5,000 + 2,000 = $86,000

36. The financial statements of Juliet Company show the following:

How much cash was collected from customers?

Calculation: $154,000 + 6,000 = $160,000

Calculation: $5.6/1.3; $5.1/1.9

Calculation: $90,000-22,500-20,000 = $47,500

43. Typical financing activities do NOT include the following:

Calculation: 3.883/1.069 = 3.63

Calculation: $50,000-8,000-15,000 = $27,000

Calculation: ($20,000-15,000) + 2,000 = $7,000