study

Question 1

operating is one of the three cash flows, what does it mean

Answer 1

day to day operations of the business

Question 2

investing is one of the three cash flows, what does it mean

Answer 2

cash transactions relating to acquisition or disposition of assets including investments- sales of investment in securities or collection of loans

Question 3

financing is one of the cash flows, what does it mean

Answer 3

cash transactions relating to business capital including borrowing money and sale of equity shares- issuance of stock, bonds and notes

Question 4

direct method

Answer 4

cash in and out flows from the company bank accounts

Question 5

indirect method

Answer 5

starting with net income and adjusting net income based on the accrual to cash difference that makes up net income

Question 6

the statement of cash flows reconciles-

Answer 6

cash and cash equivalents (og maturity date of 3 months or less)

Question 7

is restricted cash part of cash when reported on statement of cash flows?

Answer 7

yes- but not as cash on the balance sheet under assets

Question 8

Cash Inflows (revenue) Operating

Answer 8

cash received from customers (sales revenue), or revenue received from dividends and interest

Question 9

Cash Outflows (Expenses) operating

Answer 9

cash paid to suppliers for inventory, paid to employees, paid to creditors (principle), paid to insurance companies, and government

Question 10

What is the Direct Method

Answer 10

Cash Inflow- revenue
Cash Outflow- expenses

Question 11

sales revenue account is associated with

Answer 11

accounts receivable

Question 12

accounts receivable is associated with

Answer 12

sales revenue

Question 13

salaries expense is associated with

Answer 13

salary and wages payable

Question 14

salary and wages payable is associated with

Answer 14

salaries expense