Solution manual managerial accounting concept and applications by cabrera chapter 06 answer

MANAGEMENT ACCOUNTING - Solutions Manual

CHAPTER 6
CASH FLOW ANALYSIS
I.

Questions
1. Purposes of the Statement of Cash Flows
a. To predict future cash flows
b. To evaluate management decisions
c. To determine the ability to pay dividends to shareholders and
interest and principal to creditors
d. To show the relationship of net income to changes in the
business’s cash.
2. Comparative balance sheets present the financial position of the
enterprise at two points in time. The income statement for the period
between the two balance sheets describes how the income-producing
activities affected the financial position. Because cash flows from
operating activities may differ substantially from net income, and
because numerous other financing and investing activities have an
impact on financial position, the statement of cash flows is necessary.
The statement emphasizes changes in the cash balances that result from
changes in assets, liabilities and equity accounts caused by operating,
investing and financing activities.
3. The most important source of cash for many successful companies is
from operating activities. A large positive operating cash flow is a
good sign because it means funds have been internally generated with
no fixed obligations or commitment to return such to anybody.
4. It is possible for cash to decrease during a year when income is high
because cash may be used not only for operating activities but also for
investing and financing activities.

5. Transactions involving accounts payable are not considered to be
financing activities because such transactions are used to obtain goods
and services rather than to obtain cash. Furthermore, purchases of
goods and services relate to a company’s day-to-day operating
activities.
6-1


Chapter 6 Cash Flow Analysis

6. The loss is added back to net income to avoid double counting since the
entire proceeds from the sale (net book value minus loss on sale) will
appear as a cash inflow from investing activities.
7. Three categories of transactions that may result in increases in cash are
a. Operating activities
b. Investing activities (e.g., sale of investments or other assets).
c. Financing activities (e.g., borrowing or sale of shares).
These activities are sources of cash when cash is increased as a result
of the particular activity.
8. Three categories of transactions that may result in decreases in cash
are
a. Operating activities
b. Investing activities (e.g., purchase of investments or other assets).
c. Financing activities (e.g., repayment of debt or retirement of
shares).
These activities are uses of cash when cash is decreased as a result of
the particular activity.
9. Noncash transactions do not provide or consume cash even though they
may result in significant changes in financial position. Examples are
the issuance of share capital for plant assets and the conversion of debt

or preference shares into ordinary shares. Such transactions are not
presented in the body of the statement of cash flows but rather
disclosed in a separate schedule as financing or investing activities.
10. While net loss is usually associated with a decrease in cash, it may be a
source of cash if noncash expenses are greater than the amount of the
net loss. For example, if a net loss of P100,000 included amortization
and depreciation of P125,000 and no noncash revenues existed, cash
provided by operating activities would be P25,000, computed as
follows:
Net loss
Add: Expenses not requiring cash – depreciation
and amortization
Net cash provided by operating activities

6-2

P(100,000)
P

125,000
25,000


Cash Flow Analysis Chapter 6

11. The change in cash is the difference between cash at the beginning and
end of the accounting period. The net amount of cash provided by or
used in operating, investing and financing activities must equal this
change in cash. For example, if cash increased by P150,000 during the
year, total sources from operating, investing, and financing activities

must exceed total uses by P150,000. Also, if cash decreased by
P25,000 during the year, total uses of cash must exceed total sources by
P25,000.
12. (a) The use of cash does not occur until the cash dividend is actually
paid in the next period. The declaration of the dividend does affect
financial position, however, and should be disclosed as a noncash
financing activity in a separate schedule accompanying the
statement of cash flows.
(b) Because the dividend was declared and paid in the same accounting
period, it appears in the statement of cash flows as a cash decrease
in the financing activities category.
13. Disagree. The refunding of 10% debt by the 8% debt represents a
significant financing activity, even though the net impact of the
exchange on the balance sheet or on the amount of cash is not material.
The issuance of 8% bonds and the retirement of 10% bonds should be
reported as noncash financing transactions in a schedule accompanying
the statement of cash flows.
14. The net income figure includes P150,000 as an expense. Only
P112,500 of this amount resulted in a decrease in cash, because
P37,500 represents an increase in the deferred income tax liability
account. In determining cash provided by operating activities, the
amount of income tax paid is P112,500 (direct method). Alternatively,
under the indirect method, P37,500 must be added to net income to
determine cash flows from operating activities.
15. The loss is omitted when listing expenses requiring cash payment
(direct approach) or added back to net income (indirect approach) in
determining cash provided by operating activities. This eliminates the
impact of the transaction from cash provided by operating activities.
Then, the proceeds from the sale are included as a source of cash in the
investing activities category of the statement of cash flows. Any tax

effects of the transaction are included in the tax expense figure and
remain a part of cash flows from operating activities.

6-3


Chapter 6 Cash Flow Analysis

16. (1) Operating activities: Transactions that affect current assets, current
liabilities, or net income.
(2) Investing activities: Transactions that involve the acquisition or
disposition of noncurrent assets.
(3) Financing activities: Transactions (other than the payment of
interest) involving borrowing from creditors, and any transactions
(involving the owners of a company.
17. Interest is included as an operating activity since it is part of net
income. Financing activities are narrowly defined to include only the
principal amount borrowed or repaid.
18. Since the entire proceeds from a sale of an asset (including any gain)
appear as a cash inflow from investing activities, the gain must be
deducted from net income to avoid double counting.
19. The direct method reconstructs the income statement on a cash basis by
restating revenues and expenses in terms of cash inflows and outflows.
The indirect method starts with net income and adjusts it to a cash
basis to determine the cash provided by operating activities.
20. An increase in the Accounts Receivable account must be deducted from
net income under the indirect method because this is an increase in a
noncash asset.
21. A decrease in the Accounts Payable account must be added to cost of
goods sold under the direct method. The cost of goods sold is increased

by the amount of the decrease in accounts payable. Because the cost of
goods sold is increased, the net cash flow provided by operating
activities is decreased. The effect of a decrease in a liability is a
decrease in cash.
22. A sale of equipment for cash would be classified as an investing
activity. Any transaction involving the acquisition or disposition of
noncurrent assets is classified as an investing activity.

II. Exercises
6-4


Cash Flow Analysis Chapter 6

Exercise 1
Net income.................................................................................................................
P84,000
Adjustments to convert net income to a cash basis:
Depreciation charges for the year..........................................................................
P50,000
Increase in accounts receivable..............................................................................
(60,000)
Increase in inventory.............................................................................................
(77,000)
Decrease in prepaid expenses................................................................................
2,000
Increase in accounts payable..................................................................................
30,000
Decrease in accrued liabilities...............................................................................
(4,000)

Increase in deferred income taxes.........................................................................
6,000
(53,000)
Net cash provided by operating activities..................................................................
P31,000

Exercise 2
Sales....................................................................................................
P1,000,000
Adjustments to a cash basis:
–  60,000
Less increase in accounts receivable.........................................
P940,000
Cost of goods sold..............................................................................
580,000
Adjustments to a cash basis:
+  77,000
Plus increase in inventory..........................................................
–  30,000
Less increase in accounts payable.............................................
627,000
Selling and administrative expenses.................................................
300,000
Adjustments to a cash basis:
–  2,000
Less decrease in prepaid expenses............................................
+  4,000
Plus decrease in accrued liabilities............................................
–  50,000
Less depreciation charges..........................................................

252,000
Income taxes.......................................................................................
36,000
Adjustments to a cash basis:
–  6,000
Less increase in deferred income taxes.....................................

30,000

Net cash provided by operating activities.........................................P 31,000
Note that the P31,000 agrees with the cash provided by operating activities
figure under the indirect method in the previous exercise.
Exercise 3
Item
Amount
Accounts Receivable.........................................
P70,000 decrease
Accrued Interest Receivable............................
P6,000 increase
Inventory............................................................
P110,000 increase
6-5

Add
X

Deduct
X
X

Chapter 6 Cash Flow Analysis

Prepaid Expenses..............................................
P3,000
Accounts Payable..............................................
P40,000
Accrued Liabilities............................................
P9,000
Deferred Income Taxes Liability......................
P15,000
Sale of equipment..............................................
P8,000
Sale of long-term investments..........................
P12,000

decrease
decrease
increase
increase
gain
loss

X
X
X
X
X
X

Exercise 4
Requirement (1)
Net income.................................................................................................... P75
Adjustments to convert net income to a cash basis:
Depreciation charges................................................................................
P40
Decrease in accounts receivable..............................................................
10
Increase in inventory................................................................................
(30)
Decrease in prepaid expenses..................................................................
5
Increase in accounts payable...................................................................
20
Decrease in accrued liabilities.................................................................
(10)
Increase in taxes payable.........................................................................
10
Increase in deferred taxes........................................................................
5
Loss on sale of long-term investments...................................................
5
Gain on sale of land..................................................................................
(40)
15
Net cash provided by operating activities.................................................. P90

Requirement (2)
Swan Company
Statement of Cash Flows

Operating activities:
P 90
Net cash provided by operating activities (see above)........................................
Investing activities:
6-6


Cash Flow Analysis Chapter 6

P 45
Proceeds from sale of long-term investments......................................................
Proceeds from sale of land.....................................................................................
70
Additions to long-term investments......................................................................
(20)
Additions to plant & equipment............................................................................
(150)
Net cash used for investing activities...................................................................
(55)
Financing activities:
Decrease in bonds payable....................................................................................
(20)
Increase in ordinary shares....................................................................................
40
Cash dividends........................................................................................................
(35)
Net cash used by financing activities....................................................................
(15)
Net increase in cash (net cash flow).....................................................................
20

Cash balance, beginning........................................................................................
100
Cash balance, ending..............................................................................................
P120
While not a requirement, a worksheet may be helpful.

Change

Assets (except cash and cash equivalents)
Current assets:
Accounts receivable................................................
–10
Inventory.................................................................
+30
Prepaid expenses...................................................
–5
Noncurrent assets:
Long-term investments............................................
–30
Plant and equipment...............................................
+150
Land........................................................................
–30
Liabilities, Contra assets, and Shareholders’ Equity
Contra assets:
Accumulated depreciation.......................................
+40
Current liabilities:
Accounts payable....................................................
+20

Accrued liabilities....................................................
–10
Taxes payable.........................................................
+10
Noncurrent liabilities:
Bonds payable........................................................
–20
Deferred income taxes............................................+5
Shareholders’ equity:
Ordinary shares.......................................................
+40
Retained earnings:
Net income.........................................................
+75
Dividends...........................................................
–35

6-7

Source Cash
or
Flow AdjustUse? Effect ments

Source +10
Use –30
Source +5

Adjusted
Effect

Classification

+10
–30
+5

Operating
Operating
Operating

–50

–20

Investing

–30

–150
0

Investing
Investing

Source +40

+40

Operating

Source +20
Use –10
Source +10

+20
–10
+10

Operating
Operating
Operating

Use –20
Source +5

–20
+5

Financing
Operating

Source +40

+40

Financing

Source +75
Use –35

+75
–35

Operating
Financing

Source +30
–
Use 150
Source +30


Chapter 6 Cash Flow Analysis
Additional entries
Proceeds from sale of investments..............................
Loss on sale of investments.........................................
Proceeds from sale of land...........................................
Gain on sale of land.....................................................
Total

+20

+45
+5
+70
 –40
   0

+45
+5

+70
 –40
 +20

Investing
Operating
Investing
Operating

Exercise 5
Sales..............................................................................................
P600
Adjustments to a cash basis:
Decrease in accounts receivable.........................................+10
Cost of goods sold........................................................................250
Adjustments to a cash basis:
Increase in inventory...........................................................+30
Increase in accounts payable...............................................–20
Selling and administrative expenses...........................................280
Adjustments to a cash basis:
Decrease in prepaid expenses............................................. –5
Decrease in accrued liabilities............................................+10
Depreciation charges...........................................................–40
Income taxes................................................................................ 30
Adjustments to a cash basis:
Increase in taxes payable....................................................–10
Increase in deferred taxes.................................................... –5
Net cash provided by operating activities..................................
Exercise 6

P610

260

245

15
P 90

Requirements (1) and (2)
Stephenie Company
Statement of Cash Flows
For the Year Ended December 31, 2008
Operating activities:
Net income.................................................................................................P 56
Adjustments to convert net income to cash basis:
Depreciation charges.........................................................................
25
Increase in accounts receivable........................................................
(80)
Decrease in inventory.......................................................................
35
Increase in prepaid expenses............................................................
(2)
Increase in accounts payable............................................................
75
6-8


Cash Flow Analysis Chapter 6

Decrease in accrued liabilities..........................................................
(10)
Gain on sale of investments..............................................................
(5)
Loss on sale of equipment................................................................
2
Increase in deferred income taxes....................................................
8
48
Net cash provided by operating activities............................................... 104
Investing activities:
Proceeds from sale of long-term investments.........................................
12
Proceeds from sale of equipment.............................................................
18
Additions to plant and equipment............................................................
(110)
Net cash used for investing activities...................................................... (80)
Financing activities:
Increase in bonds payable.........................................................................
25
Decrease in ordinary shares.....................................................................
(40)
Cash dividends..........................................................................................
(16)
Net cash used for financing activities...................................................... (31)
Net decrease in cash.................................................................................. (7)
Cash balance, January 1, 2008................................................................. 11
Cash balance, December 31, 2008...........................................................P  4

While not a requirement, a worksheet may be helpful.

Change

Sourc
e or
Use?

Assets (except cash and cash equivalents)
Current assets:
Accounts receivable................................................
+80
Use
Inventory.................................................................
–35
Source
Prepaid expenses...................................................
+2
Use
Noncurrent assets:
Plant and equipment...............................................
+80
Use
Long-term investments............................................
–7
Source
Liabilities, Contra assets, and Shareholders’ Equity
Contra assets:
Accumulated depreciation.......................................
+15

Source
Current liabilities:
Accounts payable....................................................
+75
Source
Accrued liabilities....................................................
–10
Use
Noncurrent liabilities:
Bonds payable........................................................
+25
Source
Deferred income taxes............................................
+8
Source
Shareholders’ equity:

6-9

Cash
Flow
Effect

Adjust
-ments

–80
+35
–2

Adjuste
d Effect

Classification

–80
+35
–2

Operating
Operating
Operating

–80
+7

–30
–7

–110
0

Investing
Investing

+15

+10

+25

Operating

+75
–10

+75
–10

Operating
Operating

+25
+8

+25
+8

Financing
Operating


Chapter 6 Cash Flow Analysis
Ordinary shares.......................................................
–40
Use
Retained earnings:
Net income.........................................................
+56
Source

Dividends...........................................................
–16
Use

–40

–40

Financing

+56
–16

+56
–16

Operating
Financing

+18
+2

+18
+2

Investing
Operating

+12
 – 5

+12
  –5

Investing
Operating

  0

  –7

Additional entries
Proceeds from sale of equipment.................................
Loss on sale of equipment............................................
Proceeds from sale of long-term
investments.............................................................
Gain on sale of long-term investments.........................
 – 7

Total

II. Problems
Problem 1
1.

2.
3.
4.
5.
6.

7.

Transaction
Operating Investing Financing
Short-term investment
securities were
purchased
X
....................................
Equipment was
purchased
X
....................................
Accounts payable
increased
X
....................................
Deferred taxes
decreased
X
....................................
Long-term bonds
were issued
X
....................................
Ordinary shares were
sold
X
....................................
Interest was paid to

long-term creditors
X
....................................
6-10

Source

Use
X
X

X
X
X
X
X


Cash Flow Analysis Chapter 6
8.

A long-term mortgage
was entirely paid off
....................................
9. A cash dividend was
declared and paid
....................................
10. Inventories decreased. .
11. Accounts receivable
increased

.....................................
12. Depreciation charges
totaled P200,000 for
the year
.....................................

X

X

X

X

X
X

X

X

X

X

Problem 2 (Analysis of Cash Flow Transactions)
Requirement (a)
The eight items should be presented in the statement of cash flows as
follows:
1. Net income is the basis for the calculation of cash flows from operating

activities by starting with that number and adjusting for noncash
revenue and expense transactions (indirect method) or by computing by
the direct method the positive cash flows from revenues, less the
negative cash flows from expenses. The cash flows from the
transaction giving rise to the extraordinary loss is reclassified as an
investing activity.
2. The acquisition of intangibles is a negative cash flow from investing
activities. The amortization is a noncash expense in determining cash
flows from operating activities.
3. The payment of a cash dividend is a negative cash flow that is
presented in the financing activities section of the statement.
4. The purchase of treasury share is a negative cash flow in the financing
activities section of the statement.
5. The depreciation expense recognized during the year is a noncash
expense in determining cash flows from operating activities.
6. The conversion of convertible bonds into ordinary shares is a noncash
financing activity that requires disclosure in a separate schedule.
7. The changes in plant asset accounts – land, equipment, and building –
represent activities whose cash flow effects are presented in the
investing activities section of the statement.
6-11


Chapter 6 Cash Flow Analysis

8. The increase in working capital also represents the change in cash
because all other current assets and current liabilities remained
constant. The net of all cash flows from operating, investing and
financing activities must reconcile with the change in cash in the
statement of cash flows.

Requirement (b)
1. Net cash provided by operating activities
Net income
Noncash expense adjustments:
Depreciation expense
Amortization expense
Reclassification of extraordinary loss

P145,000
46,250
6,000
15,000
P212,250

2. Net cash used in investing activities
Purchase of intangible assets
Purchase of land
Purchase of equipment
Purchase of building
Sale of land

P (34,000)
(130,000)
(60,000)
(100,000)
165,000
P(159,000)

3. Net cash used in financing activities
Purchase of treasury shares

Payment of dividends

P(31,000)
(12,500)
P(43,500)

Computations:
Depreciation expense
Change in accumulated depreciation account
Accumulated depreciation on fully depreciated
assets disposed
Purchase of land
Change in land account
Cost of land sold in condemnation proceedings

P35,000
11,250
P46,250
P (50,000)
180,000
P130,000

Problem 3 (Cash Flow from Operating Activities)
6-12


Cash Flow Analysis Chapter 6

Cash received from customers:
Total revenues

Less: Note receivable
Cash disbursed for expenses:
Total expenses (P173,000 + P4,200)
Less: Income taxes deferred
Depreciation
Amortization
Net cash provided by operating activities

P185,000
(15,000)
P177,200
(1,260)
(25,000)
(7,000)

P170,000

(143,940)
P 26,060

Problem 4 (Cash Flow from Operating Activities)
Cash received from customers (1)
Cash paid for expenses:
Cost of goods sold
Selling
Salaries and wages (2)
Interest (3)
Miscellaneous operating
Incomes taxes (4)
Net cash provided by operating activities

Computations:

P5,237,000
P3,150,000
246,000
394,400
65,200
5,000
335,000

4,195,600
P1,041,400

1. Revenue from sales
Less: Note receivable
Land

P5,432,000
(120,000)
(75,000)
P5,237,000

2. Salaries and wages expense
Less: Increase in accrued salaries and wages
(P45,600 – P40,000)

P 400,000

3. Interest expense
Less: Discount amortization

P

(5,600)
P 394,400

P
4. Income tax expense
Less: Deferred portion

72,000
(6,800)
65,200

P 445,000
(110,000)
P 335,000

Problem 5 (Statement of Cash Flows Preparation – Indirect)

6-13


Chapter 6 Cash Flow Analysis

Green Tea Company
Statement of Cash Flows
For the Year Ended December 31, 2005
Cash flows from operating activities
Net income*

Adjustments to reconcile net income to net
cash flows provided by operating
activities:
Depreciation
Amortization of intangibles
Increase in current assets
Increase in current liabilities
Net cash provided by operating
activities
Cash flows from financing activities
Dividends paid
Retirement of long-term liabilities
Net cash used in financing activities
Net increase in cash
Cash, January 1, 2005
Cash, December 31, 2005

P8,500

1,000
1,000
(6,000)
3,000
P7,500

(1,500)
(1,000)
(2,500)
P 5,000
10,000

P15,000

Problem 6 (Cash Flow Statement Preparation – Direct)
Requirement (a)
Hundred Acre Company
Statement of Cash Flows
For the Year Ended December 31, 2005
Cash flows from operating activities
Cash received from customers
Cash paid for expense
Net cash provided by
activities
Cash flow from investing activities
Sale of equipment
*

P74,000
67,000
operating

Increase in retained earnings (P20,000 – P13,000)
Dividends declared
Net income
6-14

P7,000
9,500
P7,000
1,500
P8,500

Cash Flow Analysis Chapter 6

Sale of investments
Acquisition of equipment
Net cash used in investing activities
Cash flows from financing activities
Sale of ordinary shares
Payment of cash dividends
Net cash used in financing activities
Net increase in cash
Cash, January 1, 2005
Cash, December 31, 2005
Reconciliation of net income to net cash
provided by operating activities:
Net income
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation expense
Amortization expense
Increase in accounts receivable
Decrease in accrued expenses
Net cash provided by operating activities

15,000
(53,000)
(28,500)
40,000
(8,500)

31,500
P10,000
20,000
P30,000

P15,000
24,500*
1,000
(33,000)
(500)
P 7,000

Computations:
Cash received from customers:
Revenues
Deduct: Increase in accounts receivable
(P78,000 – P45,000)
Cash paid for expenses:
Expenses
Add: Decrease in accrued expenses
(P7,500 – P7,000)
Deduct: Depreciation expense
(P33,600 – P27,100 + P18,000)
Amortization
Cash from sale of equipment:
Cost
*

P107,000
33,000

P 74,000
P 92,000
500
(24,500)
(1,000)
P 67,000
P 27,500

Net increase during 2005 (P33,600 – P27,100)
Accumulated depreciation on assets sold
Depreciation expense for 2005
6-15

P 6,500
18,000
P24,500


Chapter 6 Cash Flow Analysis

Deduct: Accumulated depreciation
Cash received on sale at book value
Cash paid to acquire equipment:
Increase in property, plant and equipment
(P118,100 – P92,600)
Cost of machinery sold

P

(18,000)

9,500

P 25,500
27,500
P 53,000

Cash received on sale of shares:
Increase in ordinary shares amount
(P100,000 – P75,000)
Increase in additional paid-in capital account
(P55,000 – P40,000)

P 25,000

Cash dividends:
Increase in retained earnings (P21,000 – P14,500)
Net income (P107,000 – P92,000)

P

15,000
P 40,000
6,500
(15,000)
P 8,500

Requirement (b)
The reconciliation of net income to net cash provided by or used in
operating activities is required to be disclosed in order to show more
clearly the relationship and emphasize the differences between the two.

Users of financial statements are often not as aware of the accrual
concepts, which determine net income, as are preparers of those
statements. The reconciliation of net income to net cash flows from
operating activities clearly demonstrates that the two are different and
details those events and transactions that account for the difference.
Problem 7 (Interpretation of Cash Flow Statement)
Requirement (a)
The two companies are similar in the following respects:
1.
2.
3.
4.

Overall size.
Industry in which they operate.
Current ratio (2.4 to 1).
Overall peso amounts of cash provided and used:

Ebony Company

Range, 2002-2005
Cash Provided
Cash Used
P125,000 – P168,000
P115,000 – P170,000
6-16


Cash Flow Analysis Chapter 6
Ivory Company

P135,000 – P160,000

P125,000 – P165,000

5. Net increase in working capital is identical for each year, 2002 –
2005.
Requirement (b)
The two companies are dissimilar in the makeup of the sources of cash, as
indicated in the following analysis:

2002
Ebon
Ivor
y
y
Cash provided:
Operations
Long-term debt
Share capital
Asset disposition

80
8
-12
100

37
56
-7

100

Sources of Cash in Percentages
2003
2004
Ebon
Ivor
Ebon
Ivor
y
y
y
y
77
-16
7
100

21
10
52
17
100

70
--30
100

(38)
44

63
31
100

2005
Ebon
Ivor
y
y
76
9
-15
100

7
-56
37
100

Ebony Company has relied much more heavily on operations to provide
cash and to a very limited extent on debt and equity financing and asset
disposition. On the other hand, Ivory Company has not been able to
provide cash from operations and has been required to rely on the
alternatives of debt and equity financing and asset disposition.
Requirement (c)
Ebony Company is in a considerably stronger position (as determined by
the data given) and thus should be considered the better investment and
credit risk. The following points are significant:
1. Ebony Company has provided 70%-80% of its cash via operating
activities, supplementing with other means to maintain a current

ratio at the industry average. Ebony has not had to rely
consistently on any alternative source of funding.
2. Ivory Company has apparently been forced to rely continuously on
debt financing except in 2005, perhaps because of the inability to
obtain such financing. The year 2004 is particularly weak for
Ivory, with operations resulting in a P60,000 reduction in cash.
The ability of Ivory to sustain its present financial position (i.e.,
current ratio, etc.) is questionable in light of its history.
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Chapter 6 Cash Flow Analysis

III. Multiple Choice Questions
1. D
2. C
3. D

4. D
5. B
6. D

7. C
8. B
9. A

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10. B
11. A

12. D