AC302 Unit9 Discussion - GAAP requires the statement of...

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GAAP requires the statement of cash flows be presented when financial statements are prepared. Answer the following questions in the Discussion Board: a. Explain the purposes of the statement of cash flows. b. List and describe the three categories of activities that must be reported in the statement of cash flows. c. Identify and describe the two methods that are allowed for reporting cash flows from operations. d. Describe the financial statement presentation of noncash investing and financing transactions. Include in your description an example of a non-cash investing and financing transaction. A. The statement of cash flows provides information to help investors, creditors, and others assess the following: The entity’s ability to generate future cash flows. The entity’s ability to pay dividends and meet obligations. The reasons for the difference between net income and net cash flow from operating activities. The cash and noncash investing and financing transactions during the period (Kieso 1412).
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