acct 328 ch 23 questions(100% Everfree answers)
what is the purpose of the statement of cash flows? what information does it provide? correct
answers to provide information about a company's cash receipts and cash payments in a period
of what use is the statement of cash flows? correct answers -assessing future cash flows
-assessing reasons for differences between income and net cash flow from operations
-assessing operating capacity
-assessing financial flexibility and liquidity
-providing information on cash and non-cash investing and financing activities
differentiate between operating, investing, and financing activities. correct answers operating:
include all transactions and events that are not investing/financing activities; affect everything
that goes into net income
investing: involve long-term assets and acquiring/disposing of investments
financing: involve long-term liability and SHE
major sources of cash inflows and outflows?? correct answers sources: cash from operating
activities, issuance of debt, issuance of equity securities, sale of investments, sale of PPE
uses: cash used in operating activities, payment of cash dividends, redemption of debt, purchase
of investments, redemption on equity securities, purchase of PPE
identify and explain major steps involved in preparing statement of cash flows correct answers 1.
determine change in cash
2. determine net cash from operating activities
3. determine cash flows from investing/financing activities
identify following items as operating, investing or financing:
1. purchase of land
2. payment of dividends
3. cash sales
4. purchase of treasury stock correct answers 1. investing outflow
2. financing outflow
3. operating inflow
4. financing outflow
unlike the other major financial statements, cash flows isn't prepared using an adjusted trial
balance. from what sources does the information to prepare this statement come and what does
each source provide? correct answers comparative balance sheets (assets/liabilities/equities have
changed), current income statement (cash from operating), certain transaction data (whether cash
was provided or used)
what is the purpose of the statement of cash flows? what information does it provide? correct
answers to provide information about a company's cash receipts and cash payments in a period
of what use is the statement of cash flows? correct answers -assessing future cash flows
-assessing reasons for differences between income and net cash flow from operations
-assessing operating capacity
-assessing financial flexibility and liquidity
-providing information on cash and non-cash investing and financing activities
differentiate between operating, investing, and financing activities. correct answers operating:
include all transactions and events that are not investing/financing activities; affect everything
that goes into net income
investing: involve long-term assets and acquiring/disposing of investments
financing: involve long-term liability and SHE
major sources of cash inflows and outflows?? correct answers sources: cash from operating
activities, issuance of debt, issuance of equity securities, sale of investments, sale of PPE
uses: cash used in operating activities, payment of cash dividends, redemption of debt, purchase
of investments, redemption on equity securities, purchase of PPE
identify and explain major steps involved in preparing statement of cash flows correct answers 1.
determine change in cash
2. determine net cash from operating activities
3. determine cash flows from investing/financing activities
identify following items as operating, investing or financing:
1. purchase of land
2. payment of dividends
3. cash sales
4. purchase of treasury stock correct answers 1. investing outflow
2. financing outflow
3. operating inflow
4. financing outflow
unlike the other major financial statements, cash flows isn't prepared using an adjusted trial
balance. from what sources does the information to prepare this statement come and what does
each source provide? correct answers comparative balance sheets (assets/liabilities/equities have
changed), current income statement (cash from operating), certain transaction data (whether cash
was provided or used)
