9th Edition

ISBN: 9781260255775

Author: SPICELAND, Nel

Publisher: MCG

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The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business…

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Textbook Question

Chapter 21, Problem 21.3BYP

Research Case 21–3

Information from cash flow activities; FedEx

• LO21–3 through LO21–8

Real World Financials

Locate the 2015 financial statements and related disclosure notes of FedEx Corporation. You can locate the report online at www.fedex.com.

Required:

1. From the information provided in the statement of cash flows, explain what allows FedEx Corporation to expand its business, as evidenced by the investing activities, while at the same time not raising as much cash through financing activities.

2. Describe the activities listed under financing activities for the most recent fiscal year. [Hint: FedEx’s Statement of Changes in Common Stockholders’ Investment (statement of shareholders’ equity) will help you determine the nature of the stock activity.] What is the most notable financing activity reported?

3. What are the cash payments FedEx made for interest and for income taxes in the three years reported? (Hint: See the disclosure notes.)

4. Obtain the relevant authoritative literature on disclosure of interest and income taxes using the FASB Accounting Standards Codification. You might gain access at the FASB website (www.fasb.org). What is the specific citation that specifies the way FedEx reports interest and income taxes separately that enabled you to answer requirement 3?

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Chapter 21, Problem 21.2BYP

Chapter 21, Problem 21.5BYP

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Chapter 21 Solutions

SPICELAND GEN CMB LL INTRM ACCTG; CNCT

Ch. 21 - Effects of all cash flows affect the balances of...Ch. 21 - Prob. 21.2Q Ch. 21 - Prob. 21.3Q Ch. 21 - Prob. 21.4Q Ch. 21 - Prob. 21.5Q Ch. 21 - Prob. 21.6Q Ch. 21 - Prob. 21.7Q Ch. 21 - The sale of stock and the sale of bonds are...Ch. 21 - Does the statement of cash flows report only...Ch. 21 - Prob. 21.10Q

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Solution Summary: The author explains the statement of cash flows of Company F and the accounting procedure followed by it to report payment of interest and income tax.

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