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puteri [66]
3 years ago
10

When the operating activities section of the statement of cash flows is reported using the direct method: Multiple Choice Footno

tes to the financial statements disclose the difference between net income and the cash provided or used by financing activities. Noncash investing and financing activities is included in the statement of cash flows. Operating cash receipts minus operating cash payments equals net cash provided (used by)operating activities. Net income is adjusted for changes in noncurrent assets and noncurrent liabilities. The income statement is prepared under the cash basis of accounting.
Business
1 answer:
sp2606 [1]3 years ago
4 0

Answer:

Operating cash receipts minus operating cash payments equals net cash provided (used by) operating activities.

Explanation:

A statement of cash flows is also known as cash flow statement and it is a financial statement which is used to illustrate how changes in income and various account of the balance sheet affect cash and cash equivalents.

The statement of cash flows is also used by financial experts or accountants to breakdown the cash-flow analysis into;

1. Cash-flow from financing activities: it represents the cash flow from debt or equity. Typically, it's the costs used in a financing a business.

2. Cash-flow from investing activities: it represents the cash flow from investment such as proceeds from the sale of plant, equipments, etc.

3. Cash-flow from operating activities: it represents cash-flow and transactions from operational business activities such as employee salary, sales of goods, etc.

In Financial accounting, the direct method of reporting operating cash flows uses actual cash inflows and outflows from the operating activities of a company by generating data from the income statement (cash receipts and cash disbursements/payments).

Hence, when the operating activities section of the statement of cash flows is reported using the direct method; operating cash receipts minus operating cash payments (disbursements) equals net cash provided, that is typically used by operating activities.

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Implicit costs are opportunity costs.

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Suppose charles owns a​ lawn-mowing company. assume that without​ workers, no yards are mowed. when he hires one​ worker, he is
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2 years ago
The following is the adjusted trial balance of Wilson Trucking Company.
Troyanec [42]

Answer:

<u>PART 1:</u> Wilson Trucking Company reported Net Income of $15,854  for the year ended December 31, 2017.

<u>PART 2:</u> As per the statement of changes in equity, K. Wilson Capital Account Balance as at December 31, 2017 is $190,124

* Please note that figures in brackets represent negative values.

Explanation:

<u>PART 1</u>    

                                           Wilson Trucking Company

                     Income Statement for the year ended December 31, 2017

<u>Revenue </u>

Trucking Fees                                                         $115,500  

<u>Less Expenses:</u>  

Depreciation expense of Trucks                                  $(26,043)

Salaries expense                                                          $(54,170)

Office supplies expense                                          $(9,500)

Repairs expense -Trucks                                          $(9,933)

 

Net Income                                                                 $15,854  

 

<u>PART 2</u>  

                                        Wilson Trucking Company

     Statement of changes in Equity for the year ended December 31, 2017

K. Wilson Capital Account Balance as at December 31, 2016  $193,270  

Add: Net Income for the year                                                          $15,854  

Less: K. Wilson withdrawals during the year                                  $(19,000)

K. Wilson Capital Account Balance as at December 31, 2017  $190,124  

7 0
3 years ago
A landowner in fee simple signed a promissory note for $10,000 to a bank, and secured the note by a mortgage of her land to the
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Answer:

D) Both the landowner and the attorney.

Explanation:

The bank will succeed in obtaining a judgement against both the former landowner and the attorney. The bank can sue either of them or both of them, but it can only collect the $5,000 once.

  • When the attorney assumed the mortgage, he expressly promised to pay it. The lender becomes a third party beneficiary of the attorney's promise to pay and can sue him if the mortgage isn't paid.
  • The former landowner became secondarily liable to the lender in case the attorney didn't pay.

7 0
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