A statement of cash flows reports property, plant, and equipment transactions. A. What are the effects of acquisitions of plant assets on the statement of cash flows? B. In which section of the statement of cash flows are cash flows from sales of plant assets reported? C. How is depreciation reported on the statement of cash flows? Why?
A. Additions are reported as investing activities. The cash paid to acquire these assets is reported as a deduction in the investing activities category.
B. Investing Activities category
C. Depreciation is not an actual cash flow, but it is an expense on the income statement that does not require the use of cash. When a statement of cash flows is prepared using the indirect method, depreciation expense will be added back in the operating activities category since this expense was subtracted in arriving at net income, but it did not require the use of cash.
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Which of the following products is most likely to be sold by a drop-shipper?
A. coal B. toothpaste C. greeting cards D. skis E. printing supplies
Which of the following factors would be least likely to affect the estimate of the warranty liability?
a. Changes in the product. b. Changes in the nature of the warranty. c. Changes in the sales staff. d. Changes in sales volume.
Which of the following is true of channel members?
A) They act independent of each other. B) They play specialized roles in the channel. C) They are not accountable to other channel members. D) They play generalized and interchangeable roles in the distribution process. E) Their competence and cooperation don't affect the company's image or profits.
Manufacturers use seasonal discounts to
A. encourage buyers to stock inventory earlier than their normal demand would require. B. extend the peak seasonal selling season. C. prevent retailers from purchasing competitors' products. D. get rid of expired merchandise. E. temporarily spur primary demand during periods of soft sales, such as the beginning of a month, after which prices will return to normal when selective demand picks up.