Questions from Managerial Accounting

Q: Why is it better to report the noncash investing and financing activities

Why is it better to report the noncash investing and financing activities in a supplemental schedule rather than to include these activities on the body of the statement of cash flows?

Q: Explain how a company can report a positive net income and yet

Explain how a company can report a positive net income and yet still have a negative net operating cash flow.

Q: Explain how a company can report a loss and still have a

Explain how a company can report a loss and still have a positive net operating cash flow.

Q: In computing the period’s net operating cash flows, why are decreases

In computing the period’s net operating cash flows, why are decreases in liabilities and increases in current assets deducted from net income?

Q: In computing the period’s net operating cash flows, why are noncash

In computing the period’s net operating cash flows, why are noncash expenses added back to net income?

Q: Explain the reasoning for including the payment of dividends in the financing

Explain the reasoning for including the payment of dividends in the financing section of the statement of cash flows.

Q: Consider the following independent events: a. Loss on sale

Consider the following independent events: a. Loss on sale of an asset b. Decrease in accounts receivable c. Increase in prepaid insurance d. Depreciation expense e. Decrease in accounts payable f. Un...

Q: Cash inflows from operating activities come from a. payment

Cash inflows from operating activities come from a. payment for raw materials. b. gains on the sale of operating equipment. c. collection of sales revenues. d. issuing capital stock. e. issuing bonds...

Q: Cash outflows from operating activities come from a. collection

Cash outflows from operating activities come from a. collection of sales revenues. b. payment for operating costs. c. acquisition of operating equipment. d. retirement of bonds. e. none of these.

Q: Raising cash by issuing capital stock is an example of

Raising cash by issuing capital stock is an example of a. a financing activity. b. an investing activity. c. an operating activity. d. a noncash transaction. e. none of these.