WGU C213 Accounting for Decision Makers ABCD Questions with
Correct Answers 100% and Answers with Verified Solutions | Latest
2026 Update
Q: Which of the following effectively indicates the amount of cash flow from
investing activities?
Answer:
a. The exchange of common stock for attorney legal services. b. The beginning and
ending balances in the buildings and accumulated depreciation accounts combined
with information about depreciation expense from the income statement c. The net
increase in cash over the period. d. The amount of cash received from accounts
receivable. b. The beginning and ending balances in the buildings and accumulated
depreciation accounts combined with information about depreciation expense from
the income statement The cash flow projection allows a company to plan ahead as far
as timing of all the following except: a. long-term asset acquisitions. b. new loans. c.
vendor strikes. d. stock issuances c. vendor strikes. Forecasted dividend payments
paid to shareholders are reported as: a. cash outflows from investing activities. b.
cash inflows from investing activities. c. cash outflows from financing activities. d.
cash outflows from operating activities. c. cash outflows from financing activities.
The most likely situation in which reported earnings are positive but operations are
consuming rather than generating cash would be a a. company using very
conservative accounting standards that lower earnings. b. rapidly growing company.
c. company paying large cash dividends to its shareholders.
,Q: d. company reporting large noncash expenses. b. rapidly growing company.
Answer:
In rapidly growing firms, all of the following are typical except:
a. operations generate more cash than they are consuming.
b. it may be difficult to service debt and satisfy inventory demands for cash
dividends.
c. the firm experiences growing accounts receivable.
d. large amounts of cash is used to expand inventory. a. operations generate more
cash
than they are consuming.
In a statement of cash flows, proceeds from issuing equity instruments should be
classified as
cash inflows from
a. investing activities.
b. brokerage activities.
c. operating activities.
d. financing activities. d. financing activities.
In preparing a statement of cash flows, sale of treasury stock at an amount greater
than cost
would be classified as a(n)
a. investing activity.
b. transfer activity.
c. financing activity.
d. operating activity c. financing activity.
In a statement of cash flows using the direct method, which of the following would
increase
reported cash flows from operating activities?
a. Gain on sale of a business segment
b. Dividends received from investments
c. Sale of treasury stock
, Q: d. Gain on sale of equipment b. Dividends received from investments
Answer:
A loss on the sale of machinery in the ordinary course of business should be
presented in a
statement of cash flows (indirect method) as
a. an inflow and outflow of cash.
b. a deduction from net income.
c. an outflow of cash.
d. an addition to net income. d. an addition to net income.
Cash equivalents would not include short-term investments in
a. commercial paper.
b. money market funds.
c. certificates of deposit.
d. available-for-sale securities. d. available-for-sale securities.
Jurgens Corporation purchased a 3-month U.S. Treasury bill. In preparing Jurgens'
statement of
cash flows, this purchase would
a. be treated as an outflow from investing activities.
b. have no effect.
c. be treated as an outflow from financing activities.
d. be treated as an outflow from operating activities. b. have no effect.
Why is cash paid for dividends sometimes added to the denominator of the cash flow
adequacy
ratio?
a. This will allow the ratio to indicate whether operating cash flow is sufficient to pay
only
capital additions.
b. This will assist the board of directors in determining future stock dividends.
c. This will allow the ratio to indicate whether operating cash flow is sufficient to pay
both
capital additions and regular dividends to stockholders.
Correct Answers 100% and Answers with Verified Solutions | Latest
2026 Update
Q: Which of the following effectively indicates the amount of cash flow from
investing activities?
Answer:
a. The exchange of common stock for attorney legal services. b. The beginning and
ending balances in the buildings and accumulated depreciation accounts combined
with information about depreciation expense from the income statement c. The net
increase in cash over the period. d. The amount of cash received from accounts
receivable. b. The beginning and ending balances in the buildings and accumulated
depreciation accounts combined with information about depreciation expense from
the income statement The cash flow projection allows a company to plan ahead as far
as timing of all the following except: a. long-term asset acquisitions. b. new loans. c.
vendor strikes. d. stock issuances c. vendor strikes. Forecasted dividend payments
paid to shareholders are reported as: a. cash outflows from investing activities. b.
cash inflows from investing activities. c. cash outflows from financing activities. d.
cash outflows from operating activities. c. cash outflows from financing activities.
The most likely situation in which reported earnings are positive but operations are
consuming rather than generating cash would be a a. company using very
conservative accounting standards that lower earnings. b. rapidly growing company.
c. company paying large cash dividends to its shareholders.
,Q: d. company reporting large noncash expenses. b. rapidly growing company.
Answer:
In rapidly growing firms, all of the following are typical except:
a. operations generate more cash than they are consuming.
b. it may be difficult to service debt and satisfy inventory demands for cash
dividends.
c. the firm experiences growing accounts receivable.
d. large amounts of cash is used to expand inventory. a. operations generate more
cash
than they are consuming.
In a statement of cash flows, proceeds from issuing equity instruments should be
classified as
cash inflows from
a. investing activities.
b. brokerage activities.
c. operating activities.
d. financing activities. d. financing activities.
In preparing a statement of cash flows, sale of treasury stock at an amount greater
than cost
would be classified as a(n)
a. investing activity.
b. transfer activity.
c. financing activity.
d. operating activity c. financing activity.
In a statement of cash flows using the direct method, which of the following would
increase
reported cash flows from operating activities?
a. Gain on sale of a business segment
b. Dividends received from investments
c. Sale of treasury stock
, Q: d. Gain on sale of equipment b. Dividends received from investments
Answer:
A loss on the sale of machinery in the ordinary course of business should be
presented in a
statement of cash flows (indirect method) as
a. an inflow and outflow of cash.
b. a deduction from net income.
c. an outflow of cash.
d. an addition to net income. d. an addition to net income.
Cash equivalents would not include short-term investments in
a. commercial paper.
b. money market funds.
c. certificates of deposit.
d. available-for-sale securities. d. available-for-sale securities.
Jurgens Corporation purchased a 3-month U.S. Treasury bill. In preparing Jurgens'
statement of
cash flows, this purchase would
a. be treated as an outflow from investing activities.
b. have no effect.
c. be treated as an outflow from financing activities.
d. be treated as an outflow from operating activities. b. have no effect.
Why is cash paid for dividends sometimes added to the denominator of the cash flow
adequacy
ratio?
a. This will allow the ratio to indicate whether operating cash flow is sufficient to pay
only
capital additions.
b. This will assist the board of directors in determining future stock dividends.
c. This will allow the ratio to indicate whether operating cash flow is sufficient to pay
both
capital additions and regular dividends to stockholders.
