The Statement of Cash Flows Purpose of a statement of cash flows: To provide information about the cash inflows and outflows of an entity during a period. To summarize the operating, investing, and financing activities of the business. The cash flow statement helps users to assess a company’s liquidity, financial flexibility, operating capabilities, and risk. The statement of cash flows is useful because it provides answers to the following important questions:
Words: 16191 - Pages: 65
of property, plant, and equipment did Nestlé report on its December 31, 2012 balance sheet? What does the amount represent? 26,903M CHF. This is the net amount (gross less accumulated depreciation) 3. What useful life does Nestlé estimate for its machinery and equipment? 10-25 years 4. What residual value does Nestlé give to all its assets except for head offices? Zero for all asset types except head offices 5. What basis of valuation does Nestlé use for its property, plant, and
Words: 2611 - Pages: 11
Example Arlington Security System experienced the following transac8ons in October of 2009: 10/1: Made cash sales of $2,000 for its inventory (security equipment) cosCng $1,000 . 10/1: Paid rent for the quarter (October to December) in cash for $1,200. 10/1: Signed contract with Arlington Apartments to provide
Words: 746 - Pages: 3
628 inventory. Plant and equipment totaled $158,700. Current liabilities were: accounts payable $13,446; wages payable $650; and property and taxes payable $4,124. Long-term debt totaled $92,800 and owner’s equity $70,959. By comparison, for December 31, 2010, the business had current assets of: $3,278 cash; $6,954 accounts receivable; $17,417 inventory. Plant and equipment totaled $144,500. Current liabilities were: accounts payable $9,250; wages payable $1,110; property and taxes payable
Words: 651 - Pages: 3
which they were acquired. Although plant assets can fluctuate in fair market value, their book value will remain consistent. Companies must compute the total deprecation of the asset and allocate it over the useful life of the asset. (B) 1) $5000-Land 2) $200- Factory Equipment/ insurance 3) $850- Delivery Equipment 4) $17,500-Land Improvements 5) $250-Delivery Equipment 6) $8000- Factory Equipment 7) $900-Prepaid Insurance 8) $75-License Expense/Equipment E9-7 (A) 1. 2011= $3,500
Words: 417 - Pages: 2
The Statement of Cash Flows Purpose of a statement of cash flows: To provide information about the cash inflows and outflows of an entity during a period. To summarize the operating, investing, and financing activities of the business. The cash flow statement helps users to assess a company’s liquidity, financial flexibility, operating capabilities, and risk. The statement of cash flows is useful because it provides answers to the following important
Words: 15861 - Pages: 64
The Statement of Cash Flows Purpose of a statement of cash flows: To provide information about the cash inflows and outflows of an entity during a period. To summarize the operating, investing, and financing activities of the business. The cash flow statement helps users to assess a company’s liquidity, financial flexibility, operating capabilities, and risk. The statement of cash flows is useful because it provides answers to the following important questions:
Words: 15863 - Pages: 64
firm’s operating, investing, and financing activities. The latter is the purpose of the statement of cash flows. 6.4 The statement of cash flows reports changes in the investing and financing activities of a firm. Significant changes in property, plant, and equipment affect the structure of assets on the balance sheet, for example, the age of the assets. Significant changes in long-term debt or capital stock affect the maturity structure of debt and the mix of debt versus shareholder financing.
Words: 9074 - Pages: 37
Activities | | | |($9,000) | | | | | | | | | Additions to property, plant, and equipment | | | |(6,000) | | Other investing activities | | | | | |(1,000) | |Net cash provided
Words: 355 - Pages: 2
Activities | | | |($9,000) | | | | | | | | | Additions to property, plant, and equipment | | | |(6,000) | | Other investing activities | | | | | |(1,000) | |Net cash provided
Words: 355 - Pages: 2
