B describe how non-cash investing and financing activities are reported;

Question 1

report noncash investing and financing activities ?

Answer 1

No. no cash, no report on CF statement

Ex: Real estate financed by seller = investing and financing DECISION = equivalent of borrowing the purchase price, but no cash is involved.

Ex: Exchange of debt for equity = reduction of debt, increase in equity = NO CASH EXCHANGED

Question 2

Where to find Non-Cash trans?

Answer 2

Footnotes, supplemental schedule to the CF statement

Question 3

Analyst and non-cf

Answer 3

Incorp. into analysis of past and current performance, include their effects in estimating future CF’s