QUESTION 1 When analyzing a statement of cash flows the analyst should be concerned with the underlying causes of positive or negative operating cash flows. True False QUESTION 2 The change in retained earnings is often the result of both operating and financing activities. True O False QUESTION 3 If the net cash provided by or used by a company's operating activities, financing activities, and investing activities during the year are added together, the result is ____ the amount of cash reported on the company's balance sheet at the end of the year the company's net income for the year the company's total cash inflow or outflow for the year the company's change in cash during during the year QUESTION 4 Which of the following is not an item added back to income in the operations section of the statement of cash flows when using the indirect method of presentation? Increase in deferred income taxes O Amortization of bond premium Amortization of intangible assets Depreciation QUESTIONS Smith Company had sales of $60 million, an increase in accounts payable of $10 million, a decrease in accounts receivable of $2 million, and an increase in inventories of $8 million. How much cash was collected from customers 568 million 558 million $62 million O $70 million QUESTION 6 Which of the following is not a typical cash flow under operating activities? Cash inflows from interest Cash outflows to suppliers Cash inflows from sale of goods or services O Cash inflows from sale of property, plant and equipment QUESTION 7 Which of the following statements is correct? An increase in accounts receivable is added to sales to convert sales to cash received from customers. A decrease in prepaid insurance is added to insurance expense to convert insurance expense to cash paid for insurance An increase in wages payable is deducted from wages expense to convert wages expense to cash paid to employees. A decrease in accumulated depreciation is added to depreciation expense to convert depreciation expense to cash paid for depreciation. None of the selections are correct