Module4Lecture7Notes - UGBA 10 Module 4 Lecture 7 Notes 4/9...

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UGBA 10 Module 4 Lecture 7 Notes 4/9 Accounting and Finance Review Questions What is the break point for “current” versus long-term debt? A. What must be paid during the current fiscal year B. What must be paid this month C. What must be paid during the calendar year D. What must be paid within 12 months of the date of the balance sheet What is the difference between Property, Plant, and Equipment (PPE) and “Net PPE”? A. Income taxes paid B. Sales taxes paid on new equipment C. Accumulated depreciation D. Deferred depreciation Exam 36 questions from lecture 4 questions from reader Why we Need the Statement of Cash Flows Firms release income statement and balance sheet once a year o Usually give income statement and balance sheet at beginning and at end, and ask amount of income o Problem: need cash flows because of dividends Dividends are not seen as expense Statement of Cash Flows Cash flows from operations o T-shirt business makes $30 profit, if paid in cash, the tin box has $30 more, so income goes up o Less income if building up inventory Investing- building up business o Accounts receivable decrease cash o PPE ex. is cappuccino maker Financing- getting money to do this o Dividends paid is negative SBUX Statement of Cash Flows In thousands of dollars Net earnings = $564,259 Depreciation in cash flows (don’t need to worry about this) o Larger because what happens if cappuccino machine is breaks by 3 years SBUX must have excess cash around because purchased $ ½ billion of financial
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This note was uploaded on 04/01/2008 for the course UGBA 10 taught by Professor Xuanmingsu during the Spring '08 term at University of California, Berkeley.

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Module4Lecture7Notes - UGBA 10 Module 4 Lecture 7 Notes 4/9...

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