Intermediate Accounting, 10 Ed
10th Edition
ISBN: 9781260310177
Author: Mark W. Nelson, Wayne B. Thomas J. David Spiceland
Publisher: McGraw-Hill Education
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Question
Chapter 21, Problem 21.4Q
To determine
Statement of
Cash Equivalents: Cash equivalents are highly liquid, short term investments, which could be held by a company for not more than three months from the purchase date.
To Describe: The exception to the generalization, that transactions which involve merely purchases or sales of cash equivalents generally are not reported in a statement of cash flows.
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Which of the following correctly describes how to reportcash?a. Restricted cash is always reported as a current asset.b. Cash can be combined with cash equivalents.c. Cash can be combined with restricted cash.d. Cash equivalents can be combined with restricted cash.
Transactions that involve merely purchases or sales of cash equivalents generally are not reported in a statement of cash flows. Describe an exception to this generalization. What is the essential characteristic of the transaction that qualifies as an exception?
Non-business cash receipts should be included on a cash flow statement.
A. True
B. False
Chapter 21 Solutions
Intermediate Accounting, 10 Ed
Ch. 21 - Effects of all cash flows affect the balances of...Ch. 21 - Prob. 21.2QCh. 21 - Prob. 21.3QCh. 21 - Prob. 21.4QCh. 21 - Prob. 21.5QCh. 21 - Prob. 21.6QCh. 21 - Prob. 21.7QCh. 21 - The sale of stock and the sale of bonds are...Ch. 21 - Does the statement of cash flows report only...Ch. 21 - Prob. 21.10Q
Ch. 21 - Perhaps the most noteworthy item reported on an...Ch. 21 - Prob. 21.12QCh. 21 - Given sales revenue of 200,000, how can it be...Ch. 21 - Prob. 21.14QCh. 21 - When determining the amount of cash paid for...Ch. 21 - Prob. 21.16QCh. 21 - When using the indirect method of determining net...Ch. 21 - Prob. 21.18QCh. 21 - Prob. 21.19QCh. 21 - Where can we find authoritative guidance for the...Ch. 21 - U.S. GAAP designates cash outflows for interest...Ch. 21 - Prob. 21.1BECh. 21 - Prob. 21.2BECh. 21 - Prob. 21.3BECh. 21 - Prob. 21.4BECh. 21 - Investing activities LO215 Carter Containers sold...Ch. 21 - Financing activities LO216 Refer to the situation...Ch. 21 - Prob. 21.11BECh. 21 - Prob. 21.12BECh. 21 - Classification of cash flows LO213 through LO216...Ch. 21 - Indirect method; reconciliation of net income to...Ch. 21 - Prob. 21.29ECh. 21 - Prob. 21.30ECh. 21 - Prob. 21.31ECh. 21 - Prob. 21.32ECh. 21 - Prob. 21.1PCh. 21 - Research Case 219 FASB codification; locate and...Ch. 21 - IFRS Case 2110 Statement of cash flows...
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- Explain the possible restrictions on cash and their implications for classification in the balance sheet.arrow_forwardTh e assumption that the eff ects of transactions and other events are recognized when they occur, not when the cash fl ows occur, is called: A . relevance.arrow_forwardIn preparing a balance sheet, restricted cash goes under what heading?arrow_forward
- Separation of duties is important for internal control of cash receipts. cash payments. Neither of the above Both a and barrow_forwardWhy is the separation of duties control so important with cash?arrow_forwardMay you help me find which of the following answer choices does not show good cash management regarding the controls over cash disbursements?arrow_forward
- Description: Discuss why control over receivables is not quite as important as control over casharrow_forwardIn what manner can cash receipts and cash disbursements be controlled?arrow_forward23. How should significant noncash transactions be reported in the statement of cash flows? They should be incorporated in the statement of cash flows in a section labeled, "Significant Noncash Transactions." They should be handled in a manner consistent with the transactions that affect cash flows. These noncash transactions are not to be incorporated in the statement of cash flows. They may be summarized in a separate schedule at the bottom of the statement or appear in a separate supplementary schedule to the financials. Such transactions should be incorporated in the section (operating, financing, or investing) that is most representative of the major component of the transaction.arrow_forward
- Subject : Accounting The existence or occurrence assertion as related to cash is concerned with proper classification on the balance sheet. Group of answer choices True Falsearrow_forwardExplain why cash outflows during the period for purchasesand salaries are not specifically reported on a statement ofcash flows prepared using the indirect method.arrow_forward
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