Financial Accounting week 4
Financial Accounting week 4 FIN343
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This 3 page Class Notes was uploaded by Leosinh on Tuesday June 14, 2016. The Class Notes belongs to FIN343 at Marshall University taught by Brian J Bushee in Summer 2016. Since its upload, it has received 8 views.
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Date Created: 06/14/16
Financial Accounting Week 4 : Overview of Financial Accounting Explaining Important Statement of Cash Flows • Reports changes in cash due to operating, investing, and financing activities over a period of time • Statement of Cash Flows format: Net cash from operating activities + Net cash from investing activities + Net cash from financing activities = Net change in cash balance • Non-cash transactions are disclosed at the bottom of the statement • Cash interest paid and cash income taxes paid must also be disclosed Operating Activities • Transactions related to providing goods and services to customers and to paying expenses related to generating revenue (i.e. “income statement” activities) Cash inflows -> Cash outflows Collections from Payment to suppliers Operati customers ng Payment to employees Receipts of interest and Activitie Payment of interest and dividends on investments Other operating • Operating cash outflows exclude these income statement items: – Depreciation and amortization (and other noncash items). – Gains or losses on disposal of PP&E. Investing Activities • Transactions related to acquisition or disposal of long-term assets. Financing Activities Transactions related to owners or creditors (except for interest payments)
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