Discount Computers is in its second year of business providing computer repair services in the local community
Question:
At the end of the year, Justin had Nicole Roberts, one of the business interns from the local college calculate a preliminary statement of cash flows. Operating cash flows were $185,000. Justin carefully looked over the calculations that night and then met with Nicole in the morning. Justin starts out: “Nicole, you did an excellent job in preparing the statement of cash flows. The only change I could find is that we need to move the $25,000 increase in notes payable to the bank from financing activities to operating activities. We borrowed that money three months ago and plan to pay it back within a year. After you finish the changes, round up the rest of the interns. Lunch is on me.”
Required:
Do you agree with the change recommended by Justin Lake? Is there anything unethical about his actions? What should Nicole do in this situation?
Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
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Related Book For
Financial Accounting
ISBN: 978-0078025549
3rd edition
Authors: J. David Spiceland, Wayne Thomas, Don Herrmann
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