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Which of the following is incorrect about the statement of cash flows?

a. It provides information about cash receipts and cash payments of an entity during a period.

b. It provides information about the operating, investing, and financing activities of the business.

c. It reconciles the ending cash account balance to the balance per the bank statement.

d. It is the fourth basic financial statement.

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Trinidad Tremblay
Trinidad TremblayLv2
25 Feb 2020
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Related questions

Which of the following statements about the statement of cash flows is not correct?

a. It does not replace the income statement.

b. It provides details as to how cash changed during a period.

c. It provides information about cash receipts and cash payments over a period of time.

d. It measures profitability.

Ā 

Ā 

Choose the correction answer

15. The statement of cash flowsprovides information to help investors and creditors assess thecash and noncash investing and financing transactions during theperiod.

T F

16. The net increase(decrease) in cash reported on the statement of cash flows shouldreconcile the beginning and ending cash balances reported in thecomparative balance sheets.

T F

17. Anobjective of the statement of cash flows is to

a. disclose changes during the period in all assetand all equity accounts.

b. disclose the change in working capital during theperiod.

c. provide information about the operating,investing, and financing activities of an entity during aperiod.

d. None of these answers are correct.

18. Theprimary purpose of the statement of cash flows is to provideinformation

a. about the operating, investing, and financingactivities of an entity during a period.

b. that is useful in assessing future cash flowprospects.

c. about the cash receipts and cash payments of anentity during a period.

d. about the entity's ability to meet itsobligations and to pay dividends.

19. Cash equivalents are

a. treasury bills, commercial paper, and moneymarket funds purchased with excess cash.

b. investments with original maturities of threemonths or less.

c. readily convertible into known amounts ofcash.

d. All of these answers are correct.

20. Xanthe Corporation had the following transactions occur in thecurrent year:

1. Cash sale of merchandise inventory.

2. Sale of delivery truck at book value.

3. Sale of Xanthe common stock for cash.

4. Issuance of a note payable to a bank forcash.

5. Sale of a security held as anavailable-for-sale investment.

6. Collection of loan receivable.

How many of the above items willappear as a cash inflow from investing activities on a statement ofcash flows for the current year?

a. Five items

b. Four items

c. Three items

d. Two items

Non-cash investing and financing activities may be disclosed in:

a. A note in the financial statements or a schedule attached to the statement of cash flows.

b. The operating activities section of the statement of cash flows.

c. The investing activities section of the statement of cash flows.

d. The financing activities section of the statement of cash flows.

e. The reconciliation of cash balance section.

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