ADVANCED FINANCIAL ACCOUNTING IA
ADVANCED FINANCIAL ACCOUNTING IA
12th Edition
ISBN: 9781260545081
Author: Christensen
Publisher: MCG
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Chapter 10, Problem 10.7E
To determine

Consolidated statement of cash flow: Consolidated entities, as with individual companies, must present a statement of cash flow when they issue a complete set of financial statements. A consolidated statement of cash flows is similar to a statement of cash flows prepared for an individual corporate entity and is prepared in same manner. Consolidated statement of cash flow is prepared after consolidated financial statement. Consolidated cash flow statement is prepared from the information in the three consolidated statements. When an indirect approach is used, consolidated net income must be adjusted for all items that affect consolidated net income and the cash of consolidated entity effectively.

the amount of dividends paid by S. in 20X2.

b.

To determine

Consolidated statement of cash flow: Consolidated entities, as with individual companies, must present a statement of cash flow when they issue a complete set of financial statements. A consolidated statement of cash flows is similar to a statement of cash flows prepared for an individual corporate entity and is prepared in same manner. Consolidated statement of cash flow is prepared after consolidated financial statement. Consolidated cash flow statement is prepared from the information in the three consolidated statements. When an indirect approach is used, consolidated net income must be adjusted for all items that affect consolidated net income and the cash of consolidated entity effectively.

To explain:why amortization of bond premium is treated as deduction from net income to determine net cash flow from operating activities.

c.

To determine

Consolidated statement of cash flow: Consolidated entities, as with individual companies, must present a statement of cash flow when they issue a complete set of financial statements. A consolidated statement of cash flows is similar to a statement of cash flows prepared for an individual corporate entity and is prepared in same manner. Consolidated statement of cash flow is prepared after consolidated financial statement. Consolidated cash flow statement is prepared from the information in the three consolidated statements. When an indirect approach is used, consolidated net income must be adjusted for all items that affect consolidated net income and the cash of consolidated entity effectively.

To explain: why increase in accounts receivable is treated as a deduction from net income in arriving at net cash flows from operating activities.

d.

To determine

Consolidated statement of cash flow: Consolidated entities, as with individual companies, must present a statement of cash flow when they issue a complete set of financial statements. A consolidated statement of cash flows is similar to a statement of cash flows prepared for an individual corporate entity and is prepared in same manner. Consolidated statement of cash flow is prepared after consolidated financial statement. Consolidated cash flow statement is prepared from the information in the three consolidated statements. When an indirect approach is used, consolidated net income must be adjusted for all items that affect consolidated net income and the cash of consolidated entity effectively.

To explain : why dividends to non-controlling stockholders are not shown as dividends payment in the retained earnings statement but shown as distribution of cash in consolidated cash flow statement.

e.

To determine

Consolidated statement of cash flow: Consolidated entities, as with individual companies, must present a statement of cash flow when they issue a complete set of financial statements. A consolidated statement of cash flows is similar to a statement of cash flows prepared for an individual corporate entity and is prepared in same manner. Consolidated statement of cash flow is prepared after consolidated financial statement. Consolidated cash flow statement is prepared from the information in the three consolidated statements. When an indirect approach is used, consolidated net income must be adjusted for all items that affect consolidated net income and the cash of consolidated entity effectively.

did the loss on sale of equipment included in the consolidated statement of cash flows result from a sale to an affiliate or non-affiliate.

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On January 1, 2024, Presidio Company acquired 100 percent of the outstanding common stock of Mason Company. To acquire these shares, Presidio issued to the owners of Mason $310,000 in long-term liabilities and 20,000 shares of common stock having a par value of $1 per share but a fair value of $10 per share. Presidio paid $30,500 to accountants, lawyers, and brokers for assistance in the acquisition and another $15,000 in connection with stock issuance costs. Prior to these transactions, the balance sheets for the two companies were as follows: Items Presidio Company Cash Receivables Inventory Land Buildings (net) Equipment (net) Accounts payable Long-term liabilities Common stock-$1 par value Common stock-$20 par value Additional paid-in capital Retained earnings, 1/1/24 Mason Company $ 85,800 $ 39,600 361,000 189,000 362,000 211,000 269,000 185,000 425,000 276,000 217,000 52,200 (214,000) (66,300) (488,000) (310,000) (110,000) Ө Ө (120,000) (360,000) (547,800) Ө (456,500) Note:…
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ADVANCED FINANCIAL ACCOUNTING IA

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