Asked by Carol Jasso on May 13, 2024
Verified
Complete each of the columns in the table below, indicating in which section each item would be reported on the statement of cash flows
(operating, investing, or financing), the amount that would be reported, and whether the item would create an increase or decrease in cash. For items that affect more than one section of the statement, indicate all affected. Assume the indirect method of reporting cash flows from operating activities.The first item has been completed as an example.
Statement of Cash Flows
A finance report summarizing every cash inflow from ongoing business operations and external investments, and all cash outflows for corporate activities and investment purposes, within a set period.
Operating Activities
The primary day-to-day activities of a business involved in producing and selling its goods or services, reflected in the cash flow statement.
Indirect Method
A method used in cash flow statement preparation that adjusts net income for non-cash transactions and changes in working capital accounts to arrive at net cash flow from operating activities.
- Comprehend the categorization of transactions documented in the cash flow statement.
- Recognize and categorize activities related to operations, investments, and finance.
- Identify noncash investing and financing transactions and how they are reported.
Verified Answer
Learning Objectives
- Comprehend the categorization of transactions documented in the cash flow statement.
- Recognize and categorize activities related to operations, investments, and finance.
- Identify noncash investing and financing transactions and how they are reported.
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