Transcription of Chapter 6 – Statement of Cash Flows
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Chapter 6 – Statement of Cash Flows
Chapter 6 Statement of Cash FlowsThe Statement of Cash Flows describes the cash inflowsand outflows for the firm based upon three categories Activities: Generally include transactions in the normal operations of the Activities: Cash Flows resulting from purchasesand sales of property, plant and equipment, or Activities: Cash Flows resulting fromtransactions with lenders and owners. Funds received from lenders payments to lenders (not interest) Contributions of capital from owners (sales of stock) Dividend paymentsThe Direct MethodThe direct method lists the individual sources and uses ofcash. Typical line items include cash received fromcustomers, cash paid to suppliers, cash paid for wages, E3-18 Popovich Co.
Cash dividend payments -2,500 Proceeds from issuance of note payable 13,000 Proceeds from issuance of stock 4,000 Cash flows from financing activities 14,500 Net Cash Flow -10,000 Beginning Cash Balance 14,000 Ending Cash Balance 4,000. Author: stevem Created Date:
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