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Homework answers / question archive / 11
11. Identify whether each of the following items increases or decreases cash flow: Increase in accounts receivable Increase in notes payable Depreciation expense Increase in investments Decrease in accounts payable Decrease in prepaid expenses Increase in Inventory Dividend payment Increase in accrued expenses 2-11. Solution: Increase in accounts receivable Increase in notes payable Depreciation expense – Increase in investments Decrease in accounts payable Decrease in prepaid expense Increase in inventory Dividend payment Increase in accrued expenses
10. Classify the following balance sheet items as current or noncurrent: Retained earnings Accounts payable Prepaid expenses Plant and equipment Inventory Common stock Bonds payable Accrued wages payable Accounts receivable Capital in excess of par Preferred stock Marketable securities 2-10. Solution: Retained earnings Accounts payable Prepaid expense Plant and equipment Inventory Common stock Bonds payable Accrued wages payable Accounts receivable Capital in excess of par Preferred stock Marketable securities
Part 1 of question
Increase in accounts receivable -decrease in cash flow
increase in notes payable -increase in cash flow
depreciation expenses -decrease in cash flow
increase in investments -Decrease in cash flow
decrease in accounts payable -decrease in cash flow
decrease in prepaid expenses- increase in cash flow
increase in inventory -decrease in cash flow
dividend payment- decrease in cash flow
Increase in accrued expenses -decrease in cash flow
Part 2 of question
Retained earnings non-current
accounts payable -current
prepaid expenses -current
plant and equipment -non-current
inventory- current
common stock -non-current
bonds payable -non current
accrued wages payable -current
capital in excess of par -non-current
preferred stock -non-current
marketable securities -current
