Statement of Cash Flows The president of a company, which is being audited for the first time, is concerned about all the unnecessary financial information the company is being required to disclose, and says, “We have always prepared only a balance sheet and an income statement. Surely these are enough. The only information anyone is interested in is how much we earned and what we have left. Now I am told we must prepare a statement of cash flows. What is this statement, what information does it provide, what are the major sections of the statement, and what is included in each section (under the indirect method)?” Required Prepare a written response that answers the president’s questions
Statement of Cash Flows The president of a company, which is being audited for the first time, is concerned about all the unnecessary financial information the company is being required to disclose, and says, “We have always prepared only a balance sheet and an income statement. Surely these are enough. The only information anyone is interested in is how much we earned and what we have left. Now I am told we must prepare a statement of cash flows. What is this statement, what information does it provide, what are the major sections of the statement, and what is included in each section (under the indirect method)?” Required Prepare a written response that answers the president’s questions
Century 21 Accounting General Journal
11th Edition
ISBN:9781337680059
Author:Gilbertson
Publisher:Gilbertson
Chapter22: End-of-fiscal-period Work For A Corporation
Section22.3: Preparing A Statement Of Cash Flows
Problem 1OYO
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Statement of Cash Flows
The president of a company, which is being audited for the first time, is concerned about all the unnecessary financial information the company is being required to disclose, and says, “We have always prepared only a balance sheet and an income statement. Surely these are enough. The only information anyone is interested in is how much we earned and what we have left. Now I am told we must prepare a statement of cash flows. What is this statement, what information does it provide, what are the major sections of the statement, and what is included in each section (under the indirect method)?”
Required
Prepare a written response that answers the president’s questions
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