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FABM 2 > MIDTERM > Flashcards

MIDTERM Flashcards

1
Q

tells a specific story about the owner’s stake in the company.

A

STATEMENT OF CHANGES IN OWNER’S EQUITY

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2
Q

Elements of Changes in Owner’s Equity

A

Statement Heading
Beginning Capital
Additional Investment
Net Income
Drawing
Ending Capital

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3
Q

opening balance; ending capital balance of the previous year’s Statement of Changes in Owner’s Equity

A

Beginning Capital

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4
Q

any capital infusion made by the owner for the year.

A

Additional Investment

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5
Q

the amount earned by the business for the year, taken from the Statement of Comprehensive Income.

A

Net Income

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6
Q

represents the owner’s return of investment; occurs when funds are removed from the owner’s account.

A

Drawing

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7
Q

what the owner actually owns; ending capital balance of the current year’s Statement of Changes in Owner’s
Equity.

A

Ending Capital

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8
Q

reports the changes in company equity

A

Statement of Changes in Owner’s Equity

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9
Q

the amount of capital invested or owned by the owner of a company.

A

Equity

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10
Q

What is the formula for Total Ending Capital

A

Beginning Capital
+ Additional Investment
+ Net Income
Total
- Withdrawal
- Net Loss

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11
Q

represents the sources utilization of an organization’s cash and cash equivalent

A

Statement of Cash Flows

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12
Q

useful in predicting future cash outflows and inflows of the organization.

A

Statement of Cash Flows

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13
Q

what are the three major sections of SCF

A

Operating Activities
Investing Activities
Financing Activities

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14
Q

base-line cash activities of the entity related to its normal operating cycle.

A

Operating Expense

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15
Q

related to the primary revenue-producing activity of the entity

A

Operating Expenses

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16
Q

What are the activities under Operating Expense?

A

+ Cash Receipts From Sales of Goods and Rendering Services
+ Cash Receipts from royalties, fees, commissions, and other revenue
- Cash Payments to suppliers of goods and services
- Cash Payment to employees
- Cash Payment to Income Taxes
- Interest Paid
+ Interest Received
+ Dividends Received

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17
Q

+ Cash Receipts From Sales of Goods and Rendering Services

A

Operating Expense

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18
Q

+ Cash Receipts from royalties, fees, commissions and other revenue

A

Operating Expense

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19
Q
  • Cash Payments to suppliers of goods and services
A

Operating Expense

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20
Q
  • Cash Payment to employees
A

Operating Expense

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21
Q
  • Cash Payment to Income Taxes
A

Operating Expense

22
Q
  • Interest Paid
A

Operating Expense

23
Q

+ Interest Received

A

Operating Expense

24
Q

+ Dividends Received

A

Operating expense

25
Q

result from acquisition and disposal of non-current assets.

A

Investing Activities

25
Q

What are the activities under Investing Activities?

A
  • Cash Payments to acquire property, plant and equipment (PPE)
  • Cash Payments to acquire intangible assets
    + Cash receipts from sale of property, plant and equipment
    + Cash receipts from sale of intangible assets
    + Cash receipts from sale of their long-term assets
26
Q
  • Cash Payments to acquire property, plant and equipment (PPE)
A

Investing Activities

27
Q
  • Cash Payments to acquire intangible assets
A

Investing Activities

28
Q

+ Cash receipts from sale of property, plant and equipment

A

Investing Activities

29
Q

+ Cash receipts from sale of intangible assets

A

Investing Activities

30
Q

+ Cash receipts from sale of their long-term assets

A

Investing Activities

31
Q

arise from changes in non-current liabilities and owner’s equity of a business organization.

A

Financing Activities

32
Q

What are the activities in the financing activities?

A

➕ Cash Investments from owners
➕ Cash proceeds from bank loans
➖Cash distributions to owners
➖ Repayment of Bank Loans

33
Q

+ Cash Investments from owners

A

Financing Activities

34
Q

+ Cash proceeds from bank loans

A

Financing Activities

35
Q
  • Cash distributions to owners
A

Financing Activities

36
Q
  • Repayment of Bank Loans
A

Financing Activities

37
Q

Rule Decisions in Determining Classification of Cash Transaction

A
  1. Operating: Profit or Loss
  2. Investing: Non-current Assets
  3. Financing: Equity and Non-current Liabilities
38
Q

Key Features of Statement of Cash Flow

A

Statement Heading
Cash Flow from operating activities
Cash Flow from Investing Activities
Cash Flow from Financing Activities
Net Increase/Decrease
Beginning Cash Balance,
Ending cash Balance

39
Q

date format for Changes in Owner’s Equity

A

For the year ended + date

40
Q

date format for Cash flow

A

For the period ended + date

41
Q

Total cash flows from the three activities.

A

Net Increase/Decrease

42
Q

cash at the beginning of the current period

A

Beginning Cash Balance

43
Q

amount of cash at the end of the current year or period

A

Ending Cash balance

44
Q

What is the formula for Net Cash from Operating

A

total cash inflow - total cash outflow from the operating expense

45
Q

Formula for Net Cash Flows from Investing Activities

A

Total Cash Inflows minus - Total Cash Outflows from Investing Activities

46
Q

Formula for Net Increase/Decrease in cash

A

Net Cash Flows from Operating Activities
+ Net Cash Flows from IA
+ Net Cash Flows from FA

47
Q

Formula for the beginning Cash for the year

A

Ending Cash Balance of the previous year / Opening Cash Balance

48
Q

Formula for Ending Cash for the year

A

Net Increase/Decrease + Beginning Cash for the year

49
Q

Formula for Net Cash Flows from Financing Activities

A

Total Cash inflow -Total Cash outflows from Financing Activities

FABM 2 (3 decks)

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