All categories

2 years ago

The order of presentation of activities on the statement of cash flows is

Business

1 answer:

Rufina [12.5K]2 years ago

6 0

Answer:

Operating activities

Investing activities

Financing activities

Explanation:

In a cash flow statement, the activities of the organization are usually recognized in 3 parts namely; Operating activities, investing activities and financing activities.

The operating activities include elements such as net profit, non cash items, change in current assets and liabilities.

The investing activities include cash flows from the disposal and purchase of assets etc

The financing activities includes cash flows from the disposal and sale of shares etc.

The net cash flows from these activities is the netted off the cash balance at the beginning of the period to get the cash balance at the end of the period.

Hence the order of presentation of activities on the statement of cash flows is

Operating activities

Investing activities

Financing activities

You might be interested in

On December 31 of the current year, the unadjusted trial balance of a company using the percent of receivables method to estimat

Sauron [17]

Answer:

What amount should be debited to Bad Debts Expense, assuming 3% of outstanding accounts receivable

Dr Bad Debt Expense $ 1,941

Cr Allowance for Uncollectible Accounts $ 1,941

Explanation:

Initial Balance

Dr Accounts Receivable $ 97,400

Cr Allowance for Uncollectible Accounts $ 981

What amount should be debited to Bad Debts Expense,

assuming 3% of outstanding accounts receivable

Dr Bad Debt Expense $ 1,941

Cr Allowance for Uncollectible Accounts $ 1,941

FINAL Balance

Dr Accounts Receivable $ 97,400

Cr Allowance for Uncollectible Accounts $ 2,922

Bad accounts are those credits granted by the company and there is no possibility of being charged.

When customers buy products on credits but the company cannot collect the debt, then it's necessary to cancel the unpaid invoice as uncollectible.

One way is to directly cancel bad debts at the time it was decided that the credit is bad, the total amount reported as bad debt expenses negatively affect the income statement and the accounts receivable are reduced by the same amount, less assets.

The other way is to determine a percentage of the total amount of accounts receivable as bad debts, there are many ways to analyze accounts receivable and calculate the value of bad debts.

When the company has the percentage of uncollectible accounts, the required journal entry is Bad Expenses (debit) with Reserve for Bad Accounts (credit)

At the time of cancellation, since the expenses were recognized before, we only use the Allowance for Uncollectible Accounts (Debit) with accounts receivable (credit), with this we are recognizing the bad credit of the company.

5 0

2 years ago

In an effort to provide some structure to the value perspective, David Garvin of the Harvard Business School identified eight di

mel-nik [20]

Answer:

the product or service was made according to the specifications

Explanation:

Professor <em>David Garvin </em>of Harvard University proposes 8 components or dimensions of quality in order to make the concept of quality of a product or service more operational and favor the understanding of how Quality Management can be applied in companies, both manufacturing and services.

1. Performance

2. Features

3. reliability

4. Conformity to the design

5. Durability

6. Quality in service

7. Aesthetics

6 0

2 years ago

A profitable company making earthmoving equipment is considering an investment of $150,000 on equipment that will have a 5 year

Anuta_ua [19.1K]

Answer:

Earthmoving Equipment Company

The preferable method of depreciation based on the Present Worth is:

(a) Straight line method

Explanation:

a) Data and Calculations:

Cost of equipment = $150,000

Estimated useful life = 5 years

Salvage value = $50,000

Depreciable amount = $100,000 ($150,000 - $50,000)

Annual Depreciation:

Straight-line method = $20,000 ($100,000/5)

Double-declining-balance method rate = 40% (100%/5 * 2)

Depreciation Schedules:

a) Straight line method

Year Cost Depreciation Accumulated Net Book Value

Expense Depreciation

Year 1 $150,000 $20,000 $20,000 $130,000

Year 2 $150,000 $20,000 $40,000 $110,000

Year 3 $150,000 $20,000 $60,000 $90,000

Year 4 $150,000 $20,000 $80,000 $70,000

Year 5 $150,000 $20,000 $100,000 $50,000

b) double declining balance method

Year Cost Depreciation Accumulated Net Book Value

Expense Depreciation

Year 1 $150,000 $60,000 $60,000 $90,000

Year 2 $150,000 36,000 96,000 54,000

Year 3 $150,000 4,000 100,000 50,000

Year 4 $150,000

Year 5 $150,000

c) MACRS method

Year Cost Depreciation Accumulated Net Book Value

Expense Depreciation

Year 1 $150,000 $30,000 $30,000 $120,000

Year 2 $150,000 48,000 78,000 72,000

Year 3 $150,000 28,800 106,800 43,200

Year 4 $150,000 17,280 124,080 25,920

Year 5 $150,000 17,280 141,360 8,640

Year 6 $150,000 8,640 150,000 0

Discount rate (MARR) = 10%

PW of Straight-line Depreciation Charges:

PV annual factor = 3.791

PW = $75,820 ($20,000 * 3.791)

PW of Double-declining-balance:

Year 1 = $54,540 ($60,000 * .909)

Year 2 = $29,736 ($36,000 * .826)

Year 3 = $3,004 ($4,000 * .751)

PW = $87,280

PW of MACRS:

Year 1 = $27,200 ($30,000 * .909)

Year 2 = $39,648 ($48,000 * .826)

Year 3 = $21,629 ($28,800 * .751)

Year 4 = $11,802 ($17,280 * .683)

Year 5 = $10,731 ($17,280 * .621)

Year 6 = $4,873 ($8,640 * .564)

PW = $115,883

8 0

1 year ago

Gore Inc. recorded a liability in 2021 for probable litigation losses of $2 million. Ultimately, $5 million in legitimate warran

KengaRu [80]

Answer:

Gore is not required to make any accounting adjustments

Explanation:

Gore won't be required to make any accounting adjustments because the litigation loss is already $2,000,000 leading to him recording a liability in his account in which

$5 million in legitimate warranty claims were as well filed by his customers which is why he won't be making any further Accounting adjustment in 2021.

4 0

2 years ago

The following are budgeted data for the Bingham Corporation, a merchandising company:

soldi70 [24.7K]

Answer:

The correct answer is B.

Explanation:

Giving the following information:

Budgeted Sales (at retail):

January $300,000*0.60= 180,000

February $340,000*0.6= 204,000

March $400,000*0.6= 240,000

April $350,000

Cost of goods sold as a percentage of sales 60%

Desired ending inventory 75% of next month sales

April:

Purchase from March= (240,000*0.25) + (350,000*0.60*0.75)=60,000 + 157,500= $217,500

5 0

2 years ago