) State how the statement of cash flows helps
investors and creditors perform each of the following
functions:
i. Predict future cash flows.
ii. Evaluate management decisions.
Answer theoretically
i.) Predict future cash flows.
The statement of cash flows helps predict future cash flows by reporting past cash receipts and payments, which are good predictors of future cash flows. Trend of Cash Flows help to predict future. Also if a company is generating good cash flows & investing in good business ventures, its cash flow is likely to be increased, as opposed to company which is ending up paying cash flow to financiers.
ii. Evaluate management decisions
The statement of cash flows helps evaluate management decisions by reporting on managers' investments
) State how the statement of cash flows helps investors and creditors perform each of the...
Financial statements all have a goal. The statement of cash flows does as well. Describe how the statement of cash flows helps investors and creditors perform each of the following functions a Predict future cash flows. b. Evaluate management decisions c. Predict the ablity to make debt payments to lenders and pay dividends to stockholders. a. The statement of cash flows helps predict future cash flows by reporting cash which are good predictors of future cash flows.
a) Mike Corporation. Accounts Department have compiled the following data for the year ended December 31st, 2019: 35,000 40,000 Payment of dividends Proceeds from issuance of common shares Sales revenue Increase in operating current assets other than cash.. Repurchase of common shares. Cost of goods sold $ 6,000 Other operating expenses.. Purchase of equipment.... 20,000 Decrease in operating current 224,000 liabilities... Payment of note payable 30,000 Proceeds from sale of land. 5,000 Depreciation expense. $100,000 5,000 30,000 60,000 8,000 ended...
QI. a) Mike Corporation. Accounts Department have compiled the following data for the year ended December 31st, 2019: 35,000 40,000 Payment of dividends Proceeds from issuance of common shares Sales revenue Increase in operating current asfets other than cash Repurchase of common shares. Cost of goods sold $ 6,000 Other operating expenses. Purchase of equipment... 20,000 Decrease in operating current 224.000 liabilities.... Payment of note payable. 30,000 Proceeds from sale of land. 5,000 Depreciation expense $100,000 5,000 30,000 60,000 8.000...
References Review View Help Open in Desktop App Tell me what you want to do Editing 0... 12 А" А B I U A A A E A Styles v O Find v Q1. a) Mike Corporation. Accounts Department have compiled the following data for the year ended December 31st, 2019: 35,000 40,000 Payment of dividends Proceeds from issuance of common shares Sales revenue Increase in operating current asfets other than cash Repurchase of common shares. Cost of goods sold...
Why is the statement of cash flows a useful document? What can creditors, investors, and other users learn from an analysis of the cash flow statement? What are the advantages and disadvantage of having a large cash balance? Using the Apple company, analyze and report on the statement of cash flows. (Comment on operating, investing, and financing activities)
CHAPTER 5 1. The statement of cash flows helps meet the objective of financial reporting, which is to assess all of the following EXCEPT the [a] amount of future cash flows. [b] source of future cash flows. [c] timing of future cash flows. [d) uncertainty of future cash flows. Asset
Please discuss on the topic below; "How do investors, creditors, and others typically use the information in the statement of cash flows?"
A statement of cash flows helps answer all of the following: (You may select more than one answer click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)What explains the changes in the cash account?Where does a company spends its cash?How can the company improve...
Which of the following is not a use of the statement of cash flows? a.Helps creditors analyze the company's operations. b.Provides information about the sources of cash flows. c.Measures how efficiently the company's cash resources are being used. d.Provides insights into the quality and reliability of reported income.
Why is the statement of cash flows necessary? Because investors and managers wanted information on how much cash went up or down in a period Because investors and managers needed information on the net profit of a period Because investors and managers wanted additional information on why cash went up or down in a period Because the income statement is constructed using cash-basis accounting