ACCT 1002 Accounting 1B Week 6 Lecture Handout

ACCT 1002 Accounting 1B Week 6 Lecture Handout - k....

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1 ACCT 1002 Accounting 1B Lecture Handout Week 6 Cash Flow Statement The following questions are adapted from Hongren et.al. (2010) E18-10 Identifying activities for the cash flow statement-indirect method Operating activity Investing activity Financing activity Non-cash financing and investing activity (NFI) Transaction that is not reported on the cash flow statement (N) a. Loss on sale of land b. Acquisition of equipment by issue of bill payable c. Payment of long-term debt d. Acquisition of building by issue of ordinary shares e. Accrual of salary expense f. Decrease in inventory g. Increase in prepaid expenses h. Decrease in accrued liabilities i. Cash sale of land j. Issue of long-term bill payable
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Unformatted text preview: k. Depreciation of equipment l. Purchase of long-term investment m. Issue of ordinary shares n. Increase in accounts payable o. Profit p. Payment of cash dividend P18-4 Preparing the cash flow statement direct method The 20X2 comparative balance sheet and income statement of Town East Press Ltd follows. Town East had no non-cash financing and investing transactions during 20X2. During the year, there were no sales of land or equipment, no issues of bills payable and no buy-back of shares. 2 Required 1. Prepare the 20X2 cash flow statement by the direct method. 2. How will what you learned in this problem help you evaluate an investment?...
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ACCT 1002 Accounting 1B Week 6 Lecture Handout - k....

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