Lesson 25 Statement Of Cash Flow Flashcards
How should the gain from the sale of used equipment for cash be reported in a statement of cash flows using the direct method?
In operating activities as a deduction from income
A gain is not considered an operating activity
The total proceeds including gain will be reported as a cash inflow from investing activities
What should be disclosed in an enterprise statement of cash flows prepared using the indirect method?
Amounts paid for interest
Net of amounts capitalized
Amounts paid for income taxes
Acquisition of property plant & equipment is in which section of statement of cash flows?
Investing
Obtaining resources from owners and providing them with a return on investment is included in which section of the statement of cash flows?
Financing
How should the change in unamortized bond discount be reported in the statement of cash flows?
As an addition to net income in the operating activities section
If used equipment is sold at a gain, the amount shown as a cash inflow from investing activities equals the carrying amount of the equipment plus?
The gain
The sale of equipment is a cash?
Inflow from investing activities
A purchase of an equipment represents a cash?
Outflow from investing activities equal to amount paid
When there is no inflow or outflow of cash or cash equivalents transaction will not ?
Be reported in the statement of cash flows
Ie: purchasing commercial paper with a maturity of 60 days
Where are payments recorded on the statement of cash flows for a capital lease ?
Interest - cash outflow from operating activities
Portion allocated to principal - cash outflow from financing activities
The primary purpose of cash flows is to provide relevant information about
Cash receipts and cash disbursements of an enterprise during a period
During a period when a enterprise is under the direction of a particular management its financial statements will provide information about ?
Enterprise performance but not directly provide information about management performance
Interest Expense
How is it prepared in statement of cash flow under IFRS?
Either in operating activities or financing activities
Depreciation expense is added back to?
Net Income in operating section
To reconcile cash provided from operating activities back to net income subtract non cash expense items such as ?
Depreciation of equipment
Amortization of goodwill
