CHAPTER 23 Statement of Cash Flows LEARNING OBJECTIVES 1. 2. 3. 4. 5. 6. 7. 8. 9. Describe the purpose of the statement of cash flows. Identify the major classifications of cash flows. Differentiate between net income and net cash flows from operating activities. Contrast the direct and indirect methods of calculating net cash flows from operating activities. Determine net cash flows from investing and financing activities. Prepare a statement of cash flows. Identify sources of information for
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Chapter 1 Financial Statements and Business Decisions EXERCISES E1–2 Req. 1 READ MORE STORE Balance Sheet As at December 31‚ 2008 |ASSETS | |LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | |Liabilities | | |Cash |$ 48‚900
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Assignment: Candela Corporation Case Assignment: Candela Corporation Case Resource: Ch. 4 of Understanding Financial Statements * Compose a 500- to 750-word paper responding to questions 1 and 2 of the Candela Corporation Case on p. 146 (Ch. 4). * Format your paper according to APA standards. * Post your paper as an attachment. 1. Using the Consolidated Statements of Cash Flows‚ prepare a summary analysis for the years ended July 3‚ 2004‚ June 28‚ 2003‚ and June 29‚ 2002. Analyze
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__________________________________________________ 1 Problem 1. Fill in the blanks (5 Points). a. The three sections of statement of cash flows are (3 Points): Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities b. The name of the organization that writes the
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acceptable and the cash basis accounting unacceptable in the preparation of an income statement and a balance sheet? Cash basis accounting is an accounting method wherein revenues are recognized when cash is received and expenses are recognized when paid. The cash basis of accounting is usually followed by individuals and small companies; however it is not in compliance with accounting’s matching principle so that in income statement some of revenues are earned but have not been paid yet and the same applies
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VERTICAL ANALYSIS Vertical Analysis Definition A method of financial statement analysis in which each entry for each of the three major categories of accounts (assets‚ liabilities and equities) in a balance sheet is represented as a proportion of the total account. The main advantage of vertical analysis is that the balance sheets of businesses of all sizes can easily be compared. It also makes it easy to see relative annual changes within one business.
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comparative financial statements are presented; however‚ a single year may be presented in certain circumstances. Public companies must follow SEC rules‚ which typically require balance sheets for the two most recent years‚ while all other statements must cover the three-year period ended on the balance sheet date. Comparative information must be disclosed with respect to the previous period for all amounts reported in the financial statements. Layout of balance sheet and income statement No general
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Direct and Indirect Cash Flows Christine Grae XACC/291 Principles of Accounting II March 29‚ 2015 Susan Schulz When companies utilize the accrual method of accounting‚ they will prepare a cash flow statement in order to understand the flow of cash. We call this method the cash flow statement and it can be prepared in two different methods which would be indirect and direct. The methods are different but they both will be conducted with the same results for the accounting period. The direct
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AIM 6330 Topics to know for Exam I Chapter 1 – Environment and Theoretical Structure of Financial Accounting • Know the basic objectives financial reporting and the basic elements of financial statement • Know the fundamental and enhancing qualitative characteristics of accounting information. • Know the assumptions‚ principles and constraints of accounting information and be able to identify when each is being illustrated in specific accounting contexts. Chapter
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It is considered a change in estimate. b) Extraordinary item net of taxes in separate section in income statement‚ usually just before the net income. c) Write off shown as expense or loss or separate section labeled as unusual‚ if unusual OR infrequent‚ not both. [Not as extraordinary item]. d) As long as not recorded previously‚ gain should be recognized in current period in computing net income. e) Correction of error considered period adjustment and beginning balance of retained earnings reinstated
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