Statement of cash flows : Statement of cash flow is a financial statement that shows the cash and cash equivalents of a company for a particular period of time. It shows the net changes in cash, by reporting the sources and uses of cash as a result of operating, investing, and financing activities of a company. Cash flows from operating activities: These refer to the cash received or cash paid in day-to-day operating activities of a company. Indirect method of cash flow from operating activities: Under this method, the following amounts are to be adjusted from the Net Income to calculate the net cash provided from operating activities . Deduct increase in current assets Deduct decrease in current liabilities Add decrease in current assets Add the increase in current liability Add depreciation expense and amortization expense Add loss on sale of plant assets Less gain on sale of plant asset. To determine: The operating activities section of the statement of cash flows for P Company using indirect method.

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Answer 1

Question

Chapter 11, Problem 11.11E

To determine

Statement of cash flows:

Statement of cash flow is a financial statement that shows the cash and cash equivalents of a company for a particular period of time. It shows the net changes in cash, by reporting the sources and uses of cash as a result of operating, investing, and financing activities of a company.

Cash flows from operating activities: These refer to the cash received or cash paid in day-to-day operating activities of a company.

Indirect method of cash flow from operating activities: Under this method, the following amounts are to be adjusted from the Net Income to calculate the net cash provided from operating activities.

Deduct increase in current assets

Deduct decrease in current liabilities

Add decrease in current assets

Add the increase in current liability

Add depreciation expense and amortization expense

Add loss on sale of plant assets

Less gain on sale of plant asset.

To determine: The operating activities section of the statement of cash flows for P Company using indirect method.

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Depreciation is: A. A decrease in the market value of an assetB. The allocation of an asset's cost over its useful lifeC. A method for increasing an asset's value over timeD. Recorded only when an asset is sold

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Answer 2

Question

Chapter 11, Problem 11.11E

To determine

Statement of cash flows:

Statement of cash flow is a financial statement that shows the cash and cash equivalents of a company for a particular period of time. It shows the net changes in cash, by reporting the sources and uses of cash as a result of operating, investing, and financing activities of a company.

Cash flows from operating activities: These refer to the cash received or cash paid in day-to-day operating activities of a company.

Indirect method of cash flow from operating activities: Under this method, the following amounts are to be adjusted from the Net Income to calculate the net cash provided from operating activities.

Deduct increase in current assets

Deduct decrease in current liabilities

Add decrease in current assets

Add the increase in current liability

Add depreciation expense and amortization expense

Add loss on sale of plant assets

Less gain on sale of plant asset.

To determine: The operating activities section of the statement of cash flows for P Company using indirect method.

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Answer 3

Question

Chapter 11, Problem 11.11E

To determine

Statement of cash flows:

Statement of cash flow is a financial statement that shows the cash and cash equivalents of a company for a particular period of time. It shows the net changes in cash, by reporting the sources and uses of cash as a result of operating, investing, and financing activities of a company.

Cash flows from operating activities: These refer to the cash received or cash paid in day-to-day operating activities of a company.

Indirect method of cash flow from operating activities: Under this method, the following amounts are to be adjusted from the Net Income to calculate the net cash provided from operating activities.

Deduct increase in current assets

Deduct decrease in current liabilities

Add decrease in current assets

Add the increase in current liability

Add depreciation expense and amortization expense

Add loss on sale of plant assets

Less gain on sale of plant asset.

To determine: The operating activities section of the statement of cash flows for P Company using indirect method.

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Answer 4

Question

Chapter 11, Problem 11.11E

To determine

Statement of cash flows:

Statement of cash flow is a financial statement that shows the cash and cash equivalents of a company for a particular period of time. It shows the net changes in cash, by reporting the sources and uses of cash as a result of operating, investing, and financing activities of a company.

Cash flows from operating activities: These refer to the cash received or cash paid in day-to-day operating activities of a company.

Indirect method of cash flow from operating activities: Under this method, the following amounts are to be adjusted from the Net Income to calculate the net cash provided from operating activities.

Deduct increase in current assets

Deduct decrease in current liabilities

Add decrease in current assets

Add the increase in current liability

Add depreciation expense and amortization expense

Add loss on sale of plant assets

Less gain on sale of plant asset.

To determine: The operating activities section of the statement of cash flows for P Company using indirect method.

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Answer 5

Chapter 11, Problem 11.11E

To determine

Statement of cash flows:

Statement of cash flow is a financial statement that shows the cash and cash equivalents of a company for a particular period of time. It shows the net changes in cash, by reporting the sources and uses of cash as a result of operating, investing, and financing activities of a company.

Cash flows from operating activities: These refer to the cash received or cash paid in day-to-day operating activities of a company.

Indirect method of cash flow from operating activities: Under this method, the following amounts are to be adjusted from the Net Income to calculate the net cash provided from operating activities.

Deduct increase in current assets

Deduct decrease in current liabilities

Add decrease in current assets

Add the increase in current liability

Add depreciation expense and amortization expense

Add loss on sale of plant assets

Less gain on sale of plant asset.

To determine: The operating activities section of the statement of cash flows for P Company using indirect method.

Answer 6

Chapter 11, Problem 11.11E

To determine

Statement of cash flows:

Statement of cash flow is a financial statement that shows the cash and cash equivalents of a company for a particular period of time. It shows the net changes in cash, by reporting the sources and uses of cash as a result of operating, investing, and financing activities of a company.

Cash flows from operating activities: These refer to the cash received or cash paid in day-to-day operating activities of a company.

Indirect method of cash flow from operating activities: Under this method, the following amounts are to be adjusted from the Net Income to calculate the net cash provided from operating activities.

Deduct increase in current assets

Deduct decrease in current liabilities

Add decrease in current assets

Add the increase in current liability

Add depreciation expense and amortization expense

Add loss on sale of plant assets

Less gain on sale of plant asset.

To determine: The operating activities section of the statement of cash flows for P Company using indirect method.

Answer 7

Chapter 11, Problem 11.11E

To determine

Statement of cash flows:

Statement of cash flow is a financial statement that shows the cash and cash equivalents of a company for a particular period of time. It shows the net changes in cash, by reporting the sources and uses of cash as a result of operating, investing, and financing activities of a company.

Cash flows from operating activities: These refer to the cash received or cash paid in day-to-day operating activities of a company.

Indirect method of cash flow from operating activities: Under this method, the following amounts are to be adjusted from the Net Income to calculate the net cash provided from operating activities.

Deduct increase in current assets

Deduct decrease in current liabilities

Add decrease in current assets

Add the increase in current liability

Add depreciation expense and amortization expense

Add loss on sale of plant assets

Less gain on sale of plant asset.

To determine: The operating activities section of the statement of cash flows for P Company using indirect method.

Answer 8

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Answer 9

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Answer 10

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Answer 11

Ch. 11 - 1.Identify and briefly describe the three...Ch. 11 - Prob. 2RQ Ch. 11 - Explain what we mean by noncash activities and...Ch. 11 - Why is it necessary to use an income statement,...Ch. 11 - Prob. 5RQ Ch. 11 - Prob. 6RQ Ch. 11 - Distinguish between the indirect method and the...Ch. 11 - Prob. 8RQ Ch. 11 - Prob. 9RQ Ch. 11 - 10.Explain how we report depreciation expense in...

Solution Summary: The author explains how P Company's statement of cash flows is calculated using the indirect method.

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Chapter 11 Solutions