Chapter 16: Statement of Cash Flows Flashcards
In which section would the activity of receiving interest be in on the stmt of cash flows?
Operating inflow
In which section would the activity of receiving dividends be in on the stmt of cash flows?
Operating inflow
In which section would the activity of paying interest be in on the stmt of cash flows?
Operating outflow
In which section would the activity of paying dividends be in on the stmt of cash flows?
Financing outflow
How does the direct method vs indirect method of cash flows differ?
The direct method of reporting CF from operating activities includes disclosing the major classes of gross cash receipts and gross cash payments
A change in working capital asset - indirect method
A change in the working capital asset requires an adjustment on the indirect method and the adjustment will the opposite of the change (if the account went up, we subtract out that change)
A change in working capital liabilities - indirect method
A change in working capital liabilities will always be adjusted the SAME on the statement of cash flows
Where are the interest and dividends received on the stmt of cash flow?
Operating inflow
What method requires the operating section starting with NI?
The indirect method
Under the indirect method, an increase in current operating liabilities would be…
Added to NI
Under indirect method, a decrease in current operating asset would be…
Added to NI
Under the indirect method, an increase in current operating assets would be…
Subtracted from NI
Under the indirect method, a decrease in current operating liabilities would be…
Subtracted from NI
What does investing activities include?
The lending of money; collection of those loans, and the acquisition, sale or disposal of 1) loans and other securities that are not cash equivalents and that have not been acquired specifically for resale and 2) property, plant, and equipment.
What is the cash inflow equal to from the sale of equipment?
The carrying amount + gain
