The acquisition of a building by issuing bonds would be considered an investing and financing activity that did not affect cash . Question 4
The cash debt coverage ratio indicates a company ‘ s ability to repay its liabilities from cash generated from operations . Question 5
The current cash debt coverage ratio is considered a better representative of liquidity than the current ratio because it involves the entire year rather than a balance at one point in time . Question 6
The statement of cash flows Question 7
Generally , the most important category on the statement of cash flows is cash flows from Question 8
Assume that the Quinn Corporation uses the indirect method to depict cash flows . Indicate where , if at all , interest paid on note would be classified on the statement of cash flows . Question 9
Which of the following transactions does not affect cash during a period ? Question 10
Zoum Corporation had the following transactions during 2014 :
1 - Issued $ 125,000 of par value common stock for cash . 2 - Recorded and paid wages expense of $ 60,000 . 3 - Acquired land by issuing common stock of par value $ 50,000 . 4 - Declared and paid a cash dividend of $ 10,000 . 5 - Sold a long-term investment ( cost $ 3,000 ) for cash of $ 3,000 . 6 - Recorded cash sales of $ 400,000 .