Statement of cash flows : The financial statement that reports the inflows and outflows of cash of a company over a particular period of time is known as statement of cash flows. It reports the operating, investing, and financing activity that affects the cash flows of a company during a particular period. Cash flows from operating activities: These refer to the cash received or cash paid in day-to-day operating activities of a company. T-account : It refers to an individual account, where the increases or decreases in the value of specific asset, liability, stockholder’s equity , revenue, and expenditure items are recorded. This account is referred to as the T-account, because the alignment of the components of the account resembles the capital letter ‘T’.’ An account consists of the three main components which are as follows: 1. The title of the account 2. The left or debit side 3. The right or credit side To prepare: The cash flow from operating activities section of Enterprise T’s statement of cash flow using direct method.

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Chapter 4, Problem 4.21E

To determine

Statement of cash flows:

The financial statement that reports the inflows and outflows of cash of a company over a particular period of time is known as statement of cash flows. It reports the operating, investing, and financing activity that affects the cash flows of a company during a particular period.

Cash flows from operating activities:

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

T-account: It refers to an individual account, where the increases or decreases in the value of specific asset, liability, stockholder’s equity, revenue, and expenditure items are recorded.

This account is referred to as the T-account, because the alignment of the components of the account resembles the capital letter ‘T’.’ An account consists of the three main components which are as follows:

1. The title of the account

2. The left or debit side

3. The right or credit side

To prepare: The cash flow from operating activities section of Enterprise T’s statement of cash flow using direct method.

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