TAILIEUCHUNG - Lecture Fundamental accounting principles - Chapter 16: Reporting the statement of cash flows

Lecture Fundamental accounting principles - Chapter 16: Reporting the statement of cash flows. After completing this chapter you should be able to: Distinguish between operating, investing, and financing activities, and describe how noncash investing and financing activities are disclosed; analyze the statement of cash flows and apply the cash flow on total assets ratio; prepare a statement of cash flows; compute cash flows from operating activities using the indirect method. | Reporting the Statement of Cash Flows Chapter 16 PowerPoint Editor: Beth Kane, MBA, CPA Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. Chapter 16: Reporting the Statement of Cash Flows How does a company receive its cash? Where does a company spend its cash? What explains the change in the cash balance? Purpose of the Statement of Cash Flows 2 The purpose of the statement of cash flows is to report cash receipts (inflows) and cash payments (outflows) during a period. This includes separately identifying the cash flows related to operating, investing, and financing activities. It is the detailed disclosure of individual sources and uses of cash that makes this statement useful to users. Information in this statement helps users answer questions such as these: What explains the change in the cash balance? Where does a company spend its cash? How does a company receive its cash? What explains the change in the cash balance? Why do income and cash flows differ? Where does a company spend its cash? How does a company receive its cash? Importance of Cash Flows 3 Information about cash flows can influence decision makers in important ways. For instance, we look more favorably at a company that is financing its expenditures with cash from operations than one that does it by selling its assets. Information about cash flows helps users decide whether a company has enough cash to pay its existing debts as they mature. It is also relied upon to evaluate a company’s ability to meet unexpected obligations and pursue unexpected opportunities. Cash equivalents are short-term, highly liquid investments. readily convertible into cash. sufficiently close to maturity so that market value is unaffected by interest rate changes. Measurement of Cash Flows 4 Cash flows are defined to include both cash and cash equivalents. The statement of cash flows explains the difference between .

• Kế toán - Kiểm toán
• Accounting principles
• Fundamental accounting principles
• Lecture Fundamental accounting principles
• Cash flow reporting
• Cash flows
• Accounting information systems
• Fundamental system principles
• Technology based accounting systems
• Accounting information
• Financial accounting
• Managerial accounting
• Managerial cost
• Reporting manufacturing activities
• Merchandising operations
• Accounting cycle
• Completing the accounting cycle
• Classified balance sheet
• Accounting for partnerships
• Partnership form of organization
• Basic partnership accounting