Question: Discuss why in addition to preparing a statement of income
Discuss why, in addition to preparing a statement of income, it is important for companies to also prepare a statement of cash flows.
Answer to relevant QuestionsExplain what the outcome will be if a company increases its depreciation charges in an attempt to increase its cash flow from operations. Explain why a high sales growth rate can create significant cash flow problems for a company. Describe the three major categories of activities that are shown on the statement of cash flows. Financial statement data for Metro Moving Company for 2016 follow. Additional information: 1. Vehicles that cost $65,000 and had a net carrying amount of $10,000 were sold for $14,000. 2. A cash payment was made to reduce ...Practical Company had sales of $315,000 for the year. The company reported accounts receivable of $30,000 at the end of last year and $34,000 at the end of this year. Practical’s cost of goods sold this year was $246,000. ...
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