Indicate where the following would be classified on the statement of cash flows (indirect method). 13. net income 14. dividends 15. purchase of land

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Indicate where the following would be classified on the
statement of cash flows (indirect method).
13.
net income
14.
dividends
15.
purchase of land
Transcribed Image Text:Indicate where the following would be classified on the statement of cash flows (indirect method). 13. net income 14. dividends 15. purchase of land
Expert Solution
Explanation -

Cash Flow Statement -

Under Cash Flow, there are three types of activities involved -

Operating Activities - Under this activity all the company operation-related activities like sales, expenses, and depreciation. This statement starts with an income statement then all the non-cash items need to be added to it. Expenses will be added and Incomes will be deducted.

All the changes in operating current assets and Liabilities need to be added and deducted.

Investing Activities - All the Purchase sales of assets are included under this section.

Financing Activities - All the issues and purchases of shares, Payment of Dividends, Issuance, and repayment of loans are included in this section.

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