Explanation Statement of cash flows: It is one of the financial statement that shows the cash and cash equivalents of a company for a particular period. It determines the net changes in cash through reporting the sources and uses of cash due to the operating, investing, and financing activities of a company. Following are the four classifications of cash flows activities that are related to the cash flow statement: • Operating Activities: In the operating activities section of the cash flow statement, cash inflows from the revenue of the business operations are reported, while cash outflows for the expenses for the business operations are reported. • Investing activities: In the investing activities section of the cash flow statement, increase and decrease in the long-term assets representing outflow and inflow of cash on account of investing activities is reported. • Financing activities: In the financing activities section of the cash flow, increase and decrease in the long-term liabilities and equities representing inflow and outflow of cash on account of financing activities are reported. • Non-cash activities: The transactions where cash is not involved are treated as non-cash activities. Cash provided by or used in financing activities is a section of statement of cash flows...

14th Edition

ISBN: 9781337270595

Author: Carl Warren, James M. Reeve, Jonathan Duchac

Publisher: Cengage Learning

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Chapter 13, Problem 7DQ

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Explain the transaction that would be reported on the statement of cash flows.

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Explain the transaction that would be reported on the statement of cash flows .

Solution Summary: The author explains that the issuance of 20-years bonds for cash would be reported under the "financing activities section" of statement of cash flows.

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Explain the transaction that would be reported on the statement of cash flows.

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