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69.     The accounts payable at December 31, 2008 were
a.     $88,000.
b.     $216,000.
c.     $64,000.
d.     $296,000.


     70.     The balance in the Retained Earnings account at December 31, 2008 was
a.     $360,000.
b.     $880,000.
c.     $760,000.
d.     $1,000,000.

     71.     Capital stock (plus any additional paid-in capital) at December 31, 2008 was
a.     $800,000.
b.     $920,000.
c.     $520,000.
d.     $1,240,000.

Use the following information for questions 72 and 73.

The balance in retained earnings at December 31, 2007 was $720,000 and at December 31, 2008 was $582,000. Net income for 2008 was $500,000. A stock dividend was declared and distributed which increased common stock $200,000 and paid-in capital $110,000. A cash dividend was declared and paid.

     72.     The amount of the cash dividend was
a.     $248,000.
b.     $328,000.
c.     $442,000.
d.     $638,000.

     73.     The stock dividend should be reported on the statement of cash flows (indirect method) as
a.     an outflow from financing activities of $200,000.
b.     an outflow from financing activities of $310,000.
c.     an outflow from investing activities of $310,000.
d.     Stock dividends are not shown on a statement of cash flows.

     74.     The following information was taken from the 2008 financial statements of Sawyer Corporation:
Bonds payable, January 1, 2008     $ 500,000
Bonds payable, December 31, 2008      2,000,000
During 2008
•     A $450,000 payment was made to retire bonds payable with a face amount of $500,000.
•     Bonds payable with a face amount of $200,000 were issued in exchange for equipment.
In its statement of cash flows for the year ended December 31, 2008, what amount should Sawyer report as proceeds from issuance of bonds payable?
a.     $1,500,000
b.     $1,750,000
c.     $1,800,000
d.     $2,200,000


     75.     Richman Corporation had net income for 2008 of $3,000,000. Additional information is as follows:
Depreciation of plant assets     $1,200,000
Amortization of intangibles     240,000
Increase in accounts receivable     420,000
Increase in accounts payable     540,000
Richman's net cash provided by operating activities for 2008 was
a.     $4,560,000.
b.     $4,440,000.
c.     $4,320,000.
d.     $1,680,000.

     76.     Net cash flow from operating activities for 2008 for Fordham Corporation was $300,000. The following items are reported on the financial statements for 2008:
Cash dividends paid on common stock     20,000
Depreciation and amortization     12,000
Increase in accounts receivables     24,000
Based on the information above, Fordham’s net income for 2008 was
a.     $312,000.
b.     $296,000.
c.     $264,000.
d.     $256,000.

     77.     During 2008, Hogan Company earned net income of $384,000 which included deprecia-tion expense of $78,000. In addition, the company experienced the following changes in the account balances listed below:
     Increases     Decreases
Accounts payable     $45,000     Accounts receivable     $12,000
Inventory     36,000      Accrued liabilities     24,000
          Prepaid insurance     33,000
Based upon this information what amount will be shown for net cash provided by operating activities for 2008?
a.     $492,000
b.     $465,000
c.      $285,000
d.     $267,000

     78.     Robley Company reported net income of $340,000 for the year ended 12/31/08. Included in the computation of net income were: depreciation expense, $60,000; amortization of a patent, $32,000; income from an investment in common stock of Brett Inc., accounted for under the equity method, $48,000; and amortization of a bond discount, $12,000. Robley also paid an $80,000 dividend during the year. The net cash provided by operating activities would be reported at:
a.     $396,000.
b.     $316,000.
c.     $284,000.
d.     $204,000.


Questions 79 through 82 are based on the data shown below related to the statement of cash flows for Litwin, Inc.:
Litwin, Inc.
Comparative Balance Sheets
                    December 31,
                    2008               2007     
Assets:
Current Assets:
     Cash     $ 690,000     $ 540,000
     Accounts Receivable (net)     1,560,000     1,080,000
     Merchandise Inventory     1,950,000     1,260,000
     Prepaid Expenses      351,000      315,000
          Total Current Assets     4,551,000     3,195,000
Long-Term Investments     225,000
Plant Assets:
     Property, Plant & Equipment     2,190,000     1,440,000
     Accumulated Depreciation      (450,000)      (270,000)
          Total Plant Assets      1,740,000      1,170,000
Total Assets     $6,516,000     $4,365,000

Equities:
Current Liabilities:
     Accounts Payable     $1,275,000     $1,095,000
     Accrued Expenses     309,000     282,000
     Dividends Payable      201,000          
          Total Current Liabilities     1,785,000     1,377,000
Long-Term Notes Payable     825,000
Stockholders' Equity:
     Common Stock     3,000,000     2,400,000
     Retained Earnings      906,000      588,000
Total Equities     $6,516,000     $4,365,000

Litwin, Inc.
Comparative Income Statements
               December 31,
                    2008               2007     
     Net Credit Sales     $7,020,000     $3,753,000
     Cost of Goods Sold      3,915,000      1,881,000
     Gross Profit     3,105,000     1,872,000
     Expenses (including Income Tax)      2,586,000      1,374,000
     Net Income     $ 519,000     $ 498,000

     Additional Information:
a.     Accounts receivable and accounts payable relate to merchandise held for sale in the normal course of business. The allowance for bad debts was the same at the end of 2008 and 2007, and no receivables were charged against the allowance. Accounts payable are recorded net of any discount and are always paid within the discount period.
b.     The proceeds from the note payable were used to finance the acquisition of property, plant, and equipment. Capital stock was sold to provide additional working capital.
     79.     What amount of cash was collected from 2008 accounts receivable?
a.     $7,500,000.
b.     $7,020,000.
c.     $6,540,000.
d.     $3,270,000.

     80.     What amount of cash was paid on accounts payable to suppliers during 2008?
a.     $4,605,000.
b.     $4,425,000.
c.     $4,095,000.
d.     $3,735,000.

     81.     The amount to be shown on the cash flow statement as net cash provided by investing activities would total what amount?
a.     $225,000.
b.     $750,000.
c.     $795,000.
d.     $975,000.

     82.     The amount to be shown on the cash flow statement as net cash provided by financing activities would total what amount?
a.     $1,425,000.
b.     $825,000.
c.     $600,000.
d.     $408,000.

Use the following information for questions 83 and 84.

Weimers Company provided the following information on selected transactions during 2008:
Dividends paid to preferred stockholders     $ 150,000
Loans made to affiliated corporations     750,000
Proceeds from issuing bonds     900,000
Proceeds from issuing preferred stock     1,050,000
Proceeds from sale of equipment     450,000
Purchases of inventories     1,200,000
Purchase of land by issuing bonds     300,000
Purchases of treasury stock     600,000

     83.     The net cash provided (used) by investing activities during 2008 is
a.     $(600,000).
b.     $(300,000).
c.     $150,000.
d.     $450,000.

     84.     The net cash provided (used) by financing activities during 2008 is
a.     $(1,650,000).
b.     $450,000.
c.     $750,000.
d.     $1,200,000.


     85.     The net cash provided by operating activities in Otto Company's statement of cash flows for 2008 was $115,000. For 2008, depreciation on plant assets was $45,000, amortization of patent was $8,000, and cash dividends paid on common stock was $54,000. Based only on the information given above, Otto’s net income for 2008 was
a.     $115,000.
b.     $62,000.
c.     $8,000.
d.     $116,000.

     86.     During 2008, Garber Corporation, which uses the allowance method of accounting for doubtful accounts, recorded a provision for bad debt expense of $25,000 and in addition it wrote off, as uncollectible, accounts receivable of $10,000. As a result of these transactions, net cash flows from operating activities would be calculated (indirect method) by adjusting net income with a
a.     $25,000 increase.
b.     $10,000 increase.
c.     $15,000 increase.
d.     $15,000 decrease.

Use the following information for questions 87 and 88.
A flood damaged a building and contents. Floods are unusual and infrequent in this area. The receipts from insurance companies totaled $300,000, which was $90,000 less than the book values. The tax rate is 30%.

     87.     On the statement of cash flows (indirect method), the receipts from insurance companies should
a.     be shown as an addition to net income of $210,000.
b.     be shown as an inflow from investing activities of $210,000.
c.     be shown as an inflow from investing activities of $300,000.
d.     not be shown.

     88.     On the statement of cash flows (indirect method), the flood loss should
a.     be shown as an addition to net income of $63,000.
b.     be shown as an addition to net income of $90,000.
c.     be shown as an inflow from investing activities of $63,000.
d.     not be shown.

     89.     Snow Incorporated, had net income for 2008 of $5,000,000. Additional information is as follows:
Amortization of patents     $ 45,000
Depreciation on plant assets     1,650,000
Long-term debt:
     Bond premium amortization     65,000
     Interest paid     900,000
Provision for doubtful accounts:
     Current receivables     80,000
     Long-term nontrade receivables     30,000
What should be the net cash provided by operating activities in the statement of cash flows for the year ended December 31, 2008, based solely on the above information?

a.     $6,820,000.
b.     $6,870,000.
c.     $6,740,000.
d.     $6,840,000.

     90.     The net income for the year ended December 31, 2008, for Unger Company was $1,200,000. Additional information is as follows:
Depreciation on plant assets     $600,000
Amortization of leasehold improvements     340,000
Provision for doubtful accounts on short-term receivables     120,000
Provision for doubtful accounts on long-term receivables     100,000
Interest paid on short-term borrowings     80,000
Interest paid on long-term borrowings     60,000
Based solely on the information given above, what should be the net cash provided by operating activities in the statement of cash flows for the year ended December 31, 2008?
a.     $2,260,000.
b.     $2,360,000.
c.     $2,340,000.
d.     $2,500,000.

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