COLLEGE ACCOUNTING CH. 1-9 (LOW COST)
23rd Edition
ISBN: 9780357069493
Author: HEINTZ
Publisher: CENGAGE L
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Question
Chapter 6A, Problem 1RQ
To determine
Explain the purposes of the statement of
Expert Solution & Answer

Explanation of Solution
Statement of cash flows: 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.
Purpose of the statement of cash flows:
- The primary purpose of the statement of cash flows is to provide information about the
cash inflows andcash outflows of an organization. - To determine the ability of the business to pay dividend and settle debts.
- Statement of cash flows distinguishes among the operating activities, investing activities and financing activities.
- Cash flows from operating activity provide information which is helpful in estimating future profitability, liquidity, and long term solvency.
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Chapter 6A Solutions
COLLEGE ACCOUNTING CH. 1-9 (LOW COST)
Ch. 6A - Prob. 1RQCh. 6A - Prob. 2RQCh. 6A - SERIES A EXERCISE CLASSIFYING BUSINESS...Ch. 6A - SERIES A EXERCISE CLASSIFYING BUSINESS...Ch. 6A - SERIES B EXERCISE CLASSIFYING BUSINESS...Ch. 6A - SERIES B EXERCISE CLASSIFYING BUSINESS...Ch. 6A - COMPREHENSIVE PROBLEM 1: The Accounting Cycle Bob...Ch. 6A - COMPREHENSIVE PROBLEM 1, PERIOD 2: The Accounting...
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