Statement of
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.
Cash flow from investing activities: This section of cash flows statement provides information concerning about the purchase and sale of capital assets by the company.
Cash flow from financing activities: This section of cash flows statement provides information about the
Non- cash transactions:
The transaction which does not involve any cash dealings is known as non-cash transactions. In these transactions, there will not be any inflow or outflow of cash.
To classify: The given items based on operating, investing, and financing activities.
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Financial Accounting
- Analysis of Longmind Companys accounts revealed the following activity for Equipment, with descriptions added for clarity of analysis. How would these two transactions be reported for cash flow purposes? Note the section of the statement of cash flow, if applicable, and if the transaction represents a cash source, cash use, or noncash transaction.arrow_forwardRefer to the information for Cornett Company above. What amount should Cornett report on its statement of cash flows as net cash flows provided by investing activities? a. $(5,200) b. $55,200 c. $144,800 d. None of thesearrow_forwardMatch the following assertions with their associated description: (a) existence/occurrence, (b) completeness. (c) rights and obligations, (d) valuation or allocation, (e) presentation and disclosure. 1. Cash accounts arc properly classified on the balance sheet and disclosed in the notes to the financial statements. 2. Cash balances exist at the balance sheet date. 3. The recorded balances reflect the true underlying economic value of those assets. 4. The company has title to the cash accounts as of the balance sheet date. 5. Cash balances include all cash transactions that have taken place during the period.arrow_forward
- What does letter B match with??arrow_forwardI need help with thisarrow_forwardClassifying items on the statement of cash flows Cash flow items must be categorized into one of four categories. Identify each item as operating (O), investing (I), financing (F), or non-cash (N). a. Cash purchase of merchandise inventory b. Cash payment of dividends c. Cash receipt from the collection of long-term notes receivable d. Cash payment for income taxes e. Purchase of equipment in exchange for notes payable f. Cash receipt from the sale of land g. Cash received from borrowing money h. Cash receipt for interest income i. Cash receipt from the issuance of common stock j. Cash payment of salariesarrow_forward
- V5. how is this reposrted in the statement of cash flow using the direct method? conversion if bonds payable into common stock:arrow_forwardPlease help me with this practice question?arrow_forwardSuppose your company sells services of $180 in exchange for $110 cash and $70 on account.Required:1. Show the journal entry to record this transaction.2. Identify the amount that should be reported as net cash flow from operating activities.3. Identify the amount that would be included in net income.4. Show how the indirect method would convert net income (requirement 3) to net cash flowfrom operating activities (requirement 2).5. What general rule about converting net income to operating cash flows is revealed by youranswer to requirement 4?arrow_forward
- State the section(s) of the statement of cash flows prepared by the indirect method (operating activities, investing activities, financing activities, or not reported) and the amount that would be reported for each of the following transactions: Note: Only consider the cash component of each transaction. Use the minus sign to indicate amounts that are cash out flows, cash payments, decreases in cash, or any negative adjustments. If your answer is not reported in an amount box does not require an entry, leave it blank or enter "0". a. Received $120,000 from the sale of land costing $70,000. Investing activities $fill in the blank 2 Operating activities $fill in the blank 4 b. Purchased investments for $75,000. Investing activities $fill in the blank 6 c. Declared $35,000 cash dividends on stock. $5,000 dividends were payable at the beginning of the year, and $6,000 were payable at the end of the year. Financing activities $fill in the blank 8 d. Acquired equipment for…arrow_forwardClassifying transactions on the statement of cash flows—indirect method Consider the following transactions: Identify the category of the statement of cash flows in which each transaction would be reported.arrow_forwardClassifying Items in the Statement of Cash Flows The following items are commonly reported in a statement of cash flows (indirect method presentation). For each item 1 through 20, determine (a) in which section the item is presented (operating, investing, or financing) and (b) whether the associated dollar amount is added or subtracted in the statement. (a) (b) 1. Payments of short-term debt. AnswerOperatingInvestingFinancing AnswerAddSubtract 2. Repurchases of common stock. AnswerOperatingInvestingFinancing AnswerAddSubtract 3. Purchases of property and equipment. AnswerOperatingInvestingFinancing AnswerAddSubtract 4. Sale of investments classified as long-term. AnswerOperatingInvestingFinancing AnswerAddSubtract 5. Proceeds from the issuance of common stock. AnswerOperatingInvestingFinancing AnswerAddSubtract 6. Increase in prepaid expenses and other current assets. AnswerOperatingInvestingFinancing AnswerAddSubtract 7. Acquisition for cash of a competitor.…arrow_forward
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