Advanced Financial Accounting
12th Edition
ISBN: 9781259916977
Author: Christensen, Theodore E., COTTRELL, David M., Budd, Cassy
Publisher: Mcgraw-hill Education,
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Chapter 10, Problem 10.5E
To determine
Consolidated statement of cash flow:consolidated entities, as with individual companies, must present a statement of cash flow when they issue a complete set of financial statements. A consolidated statement of cash flows is similar to a statement of cash flows prepared for an individual corporate entity and is prepared in same manner. Consolidated statement of cash flow is prepared after consolidated financial statement. Consolidated cash flow statement is prepared form the information in the three consolidated statements, when an indirect approach is used consolidated net income must be adjusted for all items that affect consolidated net income and the cash of consolidated entity effectively.
Cash flows statement is divided in to three parts, cash flows from operating activities, it explains source and uses of cash from ongoing regular business activity. Cash flow from financing activity showing Funds Company generated using finance in the business and, investing activity displays how much money has been used in or generated by making investments during specific time period.
the computation of statement of cash flow for C enterprises unsing indirect method.
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Students have asked these similar questions
Use the information provided below to prepare the Cash Flow Statement of Harmony Limited for the year ended 31 December 2020.
INFORMATIONThe information provided below was extracted from the accounting records of Harmony Limited on 31 December 2020:
(Harmony Limited Information 2)
Extract of Statement of Changes in Equity for the year ended 31 December 2020
Retained
earnings
R
Balance on 01 January 2020
1 500 000
Profit after tax
480 000
Dividends paid and proposed in 2020
(180 000)
Balance on 31 December 2020
1 800 000
Note:(a) Plant and equipment was purchased but there was no disposal.
(b) The number of ordinary shares in issue was 930 000.
(c) All purchases and sales of inventory were on credit.
(d) Credit terms to debtors are 30 days. Debtors took approximately 28 days to settle their accounts during 2019.
Statement of Cash FlowPresented below are the consolidated financial statements of The Mann Corporation as of year-end 2012 and 2013.
THE MANN CORPORATIONConsolidated Balance Sheets
As of Year-End ($ thousands)
2013
2012
Assets
Current assets
Cash
$320,000
$200,000
Accounts receivable (net)
792,000
608,000
Inventory
568,000
320,000
Prepaid expenses
80,000
80,000
Total current assets
1,760,000
1,208,000
Investments in affiliate companies
80,000
-
Property and equipment
1,048,000
640,000
Less: Accumulated depreciation
(88,000)
(64,000)
Property & equipment (net)
960,000
576,000
Total assets
$2,800,000
$1,784,000
Liabilities & Shareholders' Equity
Current liabilities
Accounts payable
$456,000
$400,000
Accrued expenses payable
160,000
176,000
Dividends payable
56,000
-
Total current liabilities
672,000
576,000
Note payable-due in ten years
400,000
-
Total liabilities
1,072,000
576,000
Shareholders' equity
Common stock, $5 par value…
Parent plc obtained control of Subsidiary plc on 12 February 20X1, when Subsidiary plc held £28,000 in accounts receivable.
At 31 December 20X1, Parent and Subsidiary had accounts receivable of £90,000 and £35,000, respectively.
At 1 January 20X1, Parent had £75,000 in accounts receivable.
In relation to Parent plc’s consolidated statement of cash flow, what is the impact of the change in accounts receivable for the financial year ending 31 December 20X1?
a.
An increase in cash flow of £50,000
b.
A decrease in cash flow of £50,000
c.
An increase in cash flow of £22,000
d.
A decrease in cash flow of £22,000
e.
An increase in cash flow of £15,000
f.
A decrease in cash flow of £15,000
Chapter 10 Solutions
Advanced Financial Accounting
Ch. 10 - Prob. 10.1QCh. 10 - Why are dividend payments to noncontrolling...Ch. 10 - Prob. 10.3QCh. 10 - Why are changes in inventory balances not shown in...Ch. 10 - Prob. 10.5QCh. 10 - How is an increase in inventory included in the...Ch. 10 - What portion of the sales of an acquired company...Ch. 10 - Prob. 10.8QCh. 10 - Prob. 10.9QCh. 10 - Prob. 10.10Q
Ch. 10 - Prob. 10.11QCh. 10 - Prob. 10.12QCh. 10 - Prob. 10.13QCh. 10 - Prob. 10.14QCh. 10 - How do interperiod income tax allocation...Ch. 10 - How does the use of interperiod tax allocation...Ch. 10 - Prob. 10.17QCh. 10 - Prob. 10.18QCh. 10 - Prob. 10.19QCh. 10 - When a subsidiary’s convertible bond is treated as...Ch. 10 - Prob. 10.21QCh. 10 - What effect does the presence of a noncontrolling...Ch. 10 - Prob. 10.3CCh. 10 - Consolidated Cash Flows Analysis The consolidated...Ch. 10 - Prob. 10.1ECh. 10 - Prob. 10.2ECh. 10 - Prob. 10.3ECh. 10 - Prob. 10.4ECh. 10 - Prob. 10.5ECh. 10 - Direct Method Cash Flow Statement Using the data...Ch. 10 - Prob. 10.7ECh. 10 - Prob. 10.8ECh. 10 - Prob. 10.9ECh. 10 - Prob. 10.10ECh. 10 - Prob. 10.11ECh. 10 - Prob. 10.12ECh. 10 - Prob. 10.13ECh. 10 - Prob. 10.14ECh. 10 - Effect of Convertible Bonds on Earnings per Share...Ch. 10 - Effect of Convertible Preferred Stock on Earnings...Ch. 10 - Prob. 10.17PCh. 10 - Prob. 10.18PCh. 10 - Preparing a Statement of Cash Flows—Direct Method...Ch. 10 - Prob. 10.20PCh. 10 - Prob. 10.21PCh. 10 - Prob. 10.22PCh. 10 - Prob. 10.23PCh. 10 - Prob. 10.24PCh. 10 - Prob. 10.25PCh. 10 - Prob. 10.26PCh. 10 - Prob. 10.27PCh. 10 - Prob. 10.28PCh. 10 - Prob. 10.29PCh. 10 - Prob. 10.30PCh. 10 - Prob. 10.31PCh. 10 - Prob. 10.32PCh. 10 - Prob. 10.33P
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