WorldCom, Inc. improperly capitalized $3.8 billion dollars of expense from January 1, 2001 through the first quarter
Question:
a. What effect did WorldCom’s misclassification have on cash flows
(a) in total and
(b) by classification?
b. Why is it difficult to accept the effects on cash flow from operations of the working capital items listed above?
c. WorldCom’s long-term debt went up by approximately $13 billion during 2001. Is it possible that some of WorldCom’s current liabilities were reclassified as long-term during 2001?
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Related Book For
Accounting Theory Conceptual Issues in a Political and Economic Environment
ISBN: 978-1412991698
8th edition
Authors: Harry Wolk, James Dodd, John Rozycki
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