Cash Flows - Homework 9 and above new Review notes for ORIE...

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Homework 9 and above new Review notes for ORIE 350 1. 10/19 a. Cash Flows i. Cash Flow from Operations 1. Noncash expenses and revenues do not affect cash flows. 2. Changes in current assets (except for short-term investments and cash itself) and changes in current liabilities (except for the principal of debt to financial institutions and current portions of principal on long-term debt) reflect timing differences between net income and cash flows. ii. Cash Collected from Customers is: 1. CCfC = Net Sales – ΔA/R iii. Cash Payments for Purchases 1. CPP = Net Purchases – ΔA/P 2. CPP = CGS + ΔInv. – ΔA/P 2. 10/24 a. absorption costing i. If we produce a bunch of products but don’t sell any, then “factory rent” is stored with those products as an asset (not an expense). ii. Allocation basis = projected MOH ÷ projected Machine Hours = $1,080,000 ÷ 180,000 = $6 per machine hour iii. Non-manufacturing costs should never go into the Manufacturing Overhead account. iv.
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Cash Flows - Homework 9 and above new Review notes for ORIE...

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