All of the following would be included in a companys financing activities except

Which of the following descriptions best describes cash flows from investing activities? Those activities that relate to:

changing the size or financial structure of an entity;

altering the composition of the debt of an organisation;

the acquisition or disposal of non-current assets;

restructuring the working capital components of a business.

The following would be included amongst cash flows from financing activities:

selling or otherwise disposing of inventory for cash;

changing the size of total equity by issuing new shares for cash;

paying creditors of a business;

purchasing a new building for cash.

The following activities would be presented amongst the cash flows from operating activities on a statement of cash flows.

Cash flows from the following activities would be presented amongst the investing activities on a statement of cash flows.

Cash flows from the following activities would be presented amongst the financing activities on a statement of cash flows.

Issue of shares and other equity

For the purpose of presentation in a statement of cash flows, government taxes on the income of a business entity are regarded as:

a non-cash item to be disclosed in the notes.

The statement of cash flows presentation method that separates gross cash inflows from cash outflows is known as the:

Greta Limited had net profit of $33 000 during the financial year. Included in profit was a depreciation expense of $14 000. Across the year Accounts receivable increased by $11 000 and Accounts payable increased by $5 000. The amount of cash flow from operating activities is:

Stanton Stationery Limited had a net profit after tax of $50 000 for the financial year. Included in this profit was a depreciation expense of $10 000 and a gain on sale of Investments of $2 000. Accounts Receivable increased by $3 000; Inventories increased by $1 000 and Accounts Payable increased by $6 000. The cash flow from operating activities amounted to:

During the financial year Sugar Limited had sales of $420 000. The opening balance of Accounts receivable was $90 000, and the closing balance was $127 000. Bad debts amounting to $7 000 were written off during the period. The cash receipts from sales during the year amounted to:

During the financial year, Huang Limited has a Cost of Goods Sold amounting to $294 000. Opening balances were: Inventory $36 000; Accounts Payable $28 000. Closing balances were: Inventory $45 000; Accounts Payable $26 000. A discount of $1 000 for prompt payment was received. The amount of cash paid for goods purchased during the year was:

Bright Limited has the following ledger account balances: Income tax payable Opening balance $52 000; Closing balance $33 000. The amount of tax expense accrued at the end of the year was $ 28 000. The amount that has been paid during the year to the taxation authorities for incomes taxes is:

The following items could be included in the closing cash balance that is presented in the balance sheet of Mohammed Limited:

Short-term money market deposits

When presenting the reconciliation note of operating profit and cash flows from operating activities:

Increases in current assets during the year should be added back from the reconciliation

Increases in current liabilities during the year should be added back from the reconciliation

Dividend revenue should be deducted from the reconciliation where dividends received have been classified as operating cash flows.

Dividend revenue should be deducted from the reconciliation where dividends received have been classified as financing cash flows.

The following item would appear in a statement of cash flows:

conversion of equity to debt;

recognition of leased assets;

acquisition of equipment in exchange for debentures;

proceeds from the settlement of a court case.

The appropriate presentation treatment for non-cash investing and financing transactions is to:

show them in the statement of cash flows after the disclosure of the ending balance of cash;

present them in the statement of cash flows above the operating activities;

exclude them from the statement of cash flows;

exclude them from the investing and financing sections and include them in the operating section.

This is the end of the test. When you have completed all the questions and reviewed your answers, press the button below to grade the test.

Generally, cash receipts and cash payments are reported as gross rather than net. Two exceptions to the gross reporting are:

• Cash purchases and sales of cash and cash equivalents
• Assets and liabilities for which the turnover is quick and the maturities are three months or less (such as debt, loans receivable and the purchase and sale of highly liquid investments)

1. Cash Flows from Operating Activities

   Cash flows from operating activities result from providing services and producing and delivering goods. They include all other transactions not defined as noncapital financing, capital and related financing or investing activities. The operating activities section is, in a sense, a “catch-all” category.

   Cash inflows (proceeds) from operating activities include:

   • Cash receipts from sales of goods and services including receipts from collection of accounts receivable and both short/long-term notes receivable from customers and students arising from those sales
   • Cash receipts from quasi-external operating transactions with other funds
   • Grant receipts for activities considered as operating activities of the grantor government
   • Cash receipts for reimbursement of operating transactions
   • Cash receipts from collection of program loans

     Note: “Program loans” are loan programs undertaken to fulfill a governmental responsibility (such as low-income housing mortgages and student loans). As the loans made and collected (including the interest) are part of a governmental program, the loan activities are reported as operating activities, rather than investing activities.

   • Cash contributions to a defined benefit pension plan administered through a trust that meets the criteria in GASB 68, paragraph 4, or to a defined benefit OPEB plan administered through a trust that meets the criteria in GASB 75, paragraph 4.
   • Other cash receipts not classified in the other categories.

   Cash outflows (payments) from operating activities include:

   • Cash payments to suppliers of goods and services
   • Cash payments to employees for services including benefits

     Note: Separate accounts payable and payroll payable when determining the cash payments.

   • Cash payments for grants considered to be operating activities of the grantor
   • Cash payments for quasi-external operating transactions (including payments in lieu of taxes)
   • Cash payments for program loans
   • Cash payments for pensions or OPEB regardless of whether the defined benefit pension plan or defined benefit OPEB plan is administered through a trust that meets the specified criteria of either GASB 68, paragraph 4, or GASB 75, paragraph 4, respectively.
   • Other cash payments not classified in the other categories
2. Cash Flows from Noncapital Financing Activities

   Cash flows from noncapital financing activities include borrowing money and repaying the principal and interest on amounts borrowed for purposes other than to acquire, construct or improve capital assets.

   Cash inflows (proceeds) from noncapital financing activities include:

   • Cash receipts from short and long-term borrowings used for purposes other than to acquire, construct or improve capital assets
   • Cash receipts from grants and voluntary non-exchange transactions (gifts) not used for capital assets or for specific activities considered to be operating activities of the grantor
   • Cash receipts from other funds except amounts used for capital assets, quasi-external operating transactions or reimbursement for operating transactions
   • Cash receipts from property and other taxes not specifically restricted for capital purposes
   • Cash receipts from proceeds of state appropriations

   Cash outflows (payments) for non-capital financing activities include:

   • Repayments of principal and interest on borrowings for purposes other than acquiring, constructing or improving capital assets
   • Grant payments to other governments or organizations for activities not considered as operating activities of the grantor

     Note: It is irrelevant whether the grantee uses the grant as an operating subsidy or for capital purposes.

   • Cash payments to other funds except for quasi-external operating transactions
3. Cash Flows from Capital and Related Financing Activities

   Cash flows from capital and related financing activities include acquiring and disposing of capital assets, borrowing money to acquire, construct or improve capital assets, repaying the principal and interest amounts and paying for capital assets obtained from vendors on credit.

   Cash inflows (proceeds) from capital financing activities include:

   • Receipts from proceeds of issuing or refunding bonds and other short or long-term borrowings used to acquire, construct or improve capital assets
   • Receipts from capital grants awarded to the governmental enterprise or other contributions for capital assets
   • Receipts from contributions made by other governments, organizations or individuals (gifts) for the specific purpose of defraying the cost of acquiring, constructing or improving capital assets
   • Receipts from sales of capital assets and proceeds from insurance on capital assets that are stolen or destroyed
   • Receipts from special assessments or property and other taxes levied for capital purposes

   Cash outflows (payments) for capital financing activities include:

   • Payments to acquire, construct or improve capital assets
   • Payments on principal and interest or refunding on amounts borrowed for capital assets

     Note: Proceeds of a refunding debt issue used to refund capital debt are reported in the capital and related financing category. Likewise, subsequent principal and interest payments on the refunding debt are also reported as cash outflows in the capital and related financing category.

4. Cash Flows from Investing Activities

   Cash flows from investing activities include making and collecting loans (except program loans; see ) and the acquisition and disposition of debt or equity instruments.

   Which of the following activities are not included in financing activities?

   Sale of investment is not a financing activity.

   What are included in financing activities?

   Financing activities include transactions involving debt, equity, and dividends. Cash flow from financing activities provides investors with insight into a company's financial strength and how well a company's capital structure is managed.

   What are the 3 financing activities?

   Financing activities include:.

   Issuing and repurchasing equity..

   Borrowing and repaying short-term and long-term debt. This activity includes principal payments to lenders and vendors for most capital purchases, as well as the cost to issue debt. ... .

   Paying dividends..

   Other contributions from, or distributions to, owners..

   Which of the following is not a financing activity quizlet?

   Answer : C Dividends declared and paid are financing activities that do not affect net income or net cash flows from operating activities. Which of the following activities is not a financing activity? Answer : E It's an investing activity.