Chapter 10
The Statement of Cash Flow
483
Application Questions Group A
AP-1A (
1
)
For each item listed, indicate how the item will impact cash flow (increase, decrease or no
change) using the indirect method.
Item
Effect on Cash
Net Income
Increase in Accounts Payable
Decrease in Accounts Receivable
Purchase of Property, Plant and Equipment
Payment of Bank Loan
Increase in Inventory
Pay Dividends
Increase in Loans
Increase in Prepaid Insurance
AP-2A (
1
)
Indicate the section of the cash flow statement where each item would be located (operating,
investing or financing activities) using the indirect method.
Item
Section
Change in Accounts Payable
Change in Inventory
Change in Property, Plant and Equipment
Change in Non-Current Portion of Bank Loan
Change in Current Portion of Bank Loan
Change in Prepaid Rent
Change in Accounts Receivable
Change in Common Shares
Gain on Sale of Property, Plant and Equipment
