I have no idea where anything goes and what information is applicable in this ca
ID: 2365276 • Letter: I
Question
I have no idea where anything goes and what information is applicable in this cash flows statement. Please help! Thanks! Here are the options for the drop down boxes in the assignment. sale of land payment of cash dividens sale of equipment decrease in prepaid expenses loss on sale of equipment decrease in accounts receivable increase in prepaid expenses increase in inventory depreciation expense conversion of bonds by issuance of common stock net income purchase of equipment gain on sale of equipment increase in accounts payable increase in accounts receivable decrease in inventory decrease in accounts payable purchase of land
Explanation / Answer
In financial accounting, a cash flow statement, also known as statement of cash flows,[1] is a financial statement that shows how changes inbalance sheet accounts and income affect cash and cash equivalents, and breaks the analysis down to operating, investing, and financing activities. Essentially, the cash flow statement is concerned with the flow of cash in and out of the business. The statement captures both the current operating results and the accompanying changes in the balance sheet.[1] As an analytical tool, the statement of cash flows is useful in determining the short-term viability of a company, particularly its ability to pay bills. International Accounting Standard 7 (IAS 7), is the International Accounting Standardthat deals with cash flow statements.
People and groups interested in cash flow statements include:
http://www.tatasteel.com/investors/annual-report-2011-12/html/templates/financials/Cash%20Flow%20Statement.pdf