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emmainna [20.7K]
3 years ago
9

A company has a net cash inflow from operating activities of $793,000, a net cash outflow of $58,000 from investing activities a

nd a net cash inflow of $100,800 from financing activities. The company paid $128,000 in interest, $188,500 in income taxes, and $204,000 in cash dividends. Which of the following statements about the statement of cash flows is not correct?a. The statement of cash flows will show a net increase in cash and cash equivalents of $838, 500. b. If the direct method is used, the $125,000 of interest paid and the $187,000 of income taxes paid will be reported in the cash flows from operating activities. c. The cash dividends of $201,000 paid will be reported as a cash outflow in the cash flow from investing activities section. d. Supplemental disclosures required for a company using the indirect method include the amount of interest and the amount of income taxes paid.
Business
1 answer:
IRINA_888 [86]3 years ago
4 0

Answer:

Incorrect Statement about the Statement of Cash Flows:

c. The cash dividends of $201,000 paid will be reported as a cash outflow in the cash flow from investing activities section.

Explanation:

Cash dividends of $201,000 will be reported as a cash outflow in the financing activities section and not the investing activities section.

Statement of Cash Flows is broadly divided into three, the operating, investing, and financing activities sections.  The operating activities section show the cash flows from the normal business of the enterprise.  The investing activities section shows the acquisition and disposal of investments made by the company in cash.  While, the financing section shows the inflow and outflow of cash resulting from the funding of the business by stockholders and noncurrent creditors.

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Gramps purchased a joint survivor annuity that pays $500 monthly over his remaining life and that of his wife, Gram. Gramps is 7
Bezzdna [24]

Answer:

$150

Explanation:

Calculation of how much income that Gramps will recognize on the first payment.

Since joint survivor annuity has 23.1 as the annual return multiple .

Calculation for Expected return

Expected return =Annual payment *Return multiple

($500*12) =$6,000

$6,000×23.1

=$138,600

Therefore :

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The 70% of each of the payment will be the return of capital while the 30%(100%-70%) will be the income.

Hence the first payment be:

30%×500

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Therefore the amount of income that Gramps will recognize on the first payment will be $150

6 0
3 years ago
On February 1, a seller paid $1,140 in annual property tax for the current calendar year. He sold the house with the closing set
tigry1 [53]

Answer:

$288

Explanation:

Since the total property taxes for the year are $1,140, to find the property tax per month we have to divide by 12 ⇒ $1,140 / 12 = $95 per month

The seller is responsible for paying the property taxes during 3 months and 1 day, to find out the amount for that 1 day we divide the monthly tax by 30 = $3.17 per day.

the total seller's credit = ($95 x 3) + $3 = $285 + $3 = $288

*The seller's credit includes all the expenses that must be paid by the seller, while the seller's debit includes all the money that he receives.

6 0
3 years ago
You purchased a bond at a price of $1,700. In 20 years when the bond matures, the bond will be worth $10,000. It is exactly 13 y
ryzh [129]

Answer:

<u>Annual rate of return which will be earned from today is 5.89%</u>

Explanation:

FV = PV (1+r)^n

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= 1.0589

r = 1.0589- 1

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