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. Indirect method: Under this method, the following amounts are to be adjusted from the Net Incometo calculate the net cash provided from operating activities . Cash flows from operating activities: These are the cash produced by the normal business operations. The below table shows the way of calculation of cash flows from operating activities: Cash flows from operating activities (Indirect method) Add: Decrease in current assets Increase in current liability Depreciation expense and amortization expense Loss on sale of plant assets Deduct: Increase in current assets Decrease in current liabilities Gain on sale of plant assets Net cash provided from or used by operating activities Table (1) To Compute: Net cash flows from operating activities under indirect method.
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. Indirect method: Under this method, the following amounts are to be adjusted from the Net Incometo calculate the net cash provided from operating activities . Cash flows from operating activities: These are the cash produced by the normal business operations. The below table shows the way of calculation of cash flows from operating activities: Cash flows from operating activities (Indirect method) Add: Decrease in current assets Increase in current liability Depreciation expense and amortization expense Loss on sale of plant assets Deduct: Increase in current assets Decrease in current liabilities Gain on sale of plant assets Net cash provided from or used by operating activities Table (1) To Compute: Net cash flows from operating activities under indirect method.
Solution Summary: The author explains that YW Corporation's Statement of Cash Flows determines the net changes in cash through reporting the sources and uses of cash due to the operating, investing, and financing activities.
Definition Video Definition Accounting method wherein the cost of a tangible asset is spread over the asset's useful life. Depreciation usually denotes how much of the asset's value has been used up and is usually considered an operating expense. Depreciation occurs through normal wear and tear, obsolescence, accidents, etc. Video
Chapter 16, Problem 16.2BPE
To determine
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.
Indirect method: Under this method, the following amounts are to be adjusted from the Net Incometo calculate the net cash provided from operating activities.
Cash flows from operating activities: These are the cash produced by the normal business operations.
The below table shows the way of calculation of cash flows from operating activities:
Cash flows from operating activities (Indirect method)
Add: Decrease in current assets
Increase in current liability
Depreciation expense and amortization expense
Loss on sale of plant assets
Deduct: Increase in current assets
Decrease in current liabilities
Gain on sale of plant assets
Net cash provided from or used by operating activities
Table (1)
To Compute: Net cash flows from operating activities under indirect method.
Chapter 20 Homework
19
1
points
Exercise 20-17 (Algo) Preparation of cash budgets (for three periods) LO P2
Kayak Company budgeted the following cash receipts (excluding cash receipts from loans received) and cash payments (excluding
cash payments for loan principal and interest payments) for the first three months of next year.
Cash Receipts
Cash payments
eBook
January
February
March
$ 519,000
406,500
474,000
$ 463,600
351,100
524,000
Hint
Ask
Print
References
Mc
Graw
Hill
Kayak requires a minimum cash balance of $40,000 at each month-end. Loans taken to meet this requirement charge 1%, interest per
month, paid at each month-end. The interest is computed based on the beginning balance of the loan for the month. Any preliminary
cash balance above $40,000 is used to repay loans at month-end. The company has a cash balance of $40,000 and a loan balance of
$80,000 at January 1.
Prepare monthly cash budgets for January, February, and March.
Note: Negative balances and Loan repayment…
How much is the accounts receivable turnover ratio?
If the cost of the beginning work in process inventory is $92,000, costs of goods manufactured is $1,050,000, direct materials cost is $375,000, direct labor cost is $255,000, and overhead cost is $360,000, calculate the ending work in process inventory. a. $158,000 b. $32,000 c. $45,000 d. $12,000
Chapter 16 Solutions
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