When the items needed for the additional information required by the direct method are so easy to

Question:

When the items needed for the additional information required by the direct method are so easy to identify from the Cash Book, why do you think most companies prefer to use the indirect method?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Frank Woods Business Accounting Volume 2

ISBN: 9780273693109

10th Edition

Authors: Frank Wood, Alan Sangster

See More Books

Question Posted: Sep 08, 2023 06:29 AM

See More Questions

Planning is one of the most important management functions in any business. A front office managers first step in planning should involve determine the departments goals. Planning also includes...
The Weld, Bergevin, and Magrath article points out that if a company is going to intentionally manipulate earnings, they must be astute enough to present financial statements that still seem...
Now that you have background on ethics and a set of skills for evaluating ethical issues, the application to real-life dilemmas seems fairly straightforward. However, there is one additional aspect...
Jane Grimes, retail fruit and vegetable merchant, does not keep a full set of accounting records. However, the following information has been produced from the business's records: 1. Summary of the...
Guardian Services is a firm that provides security services to apartment buildings and offices. Smartly dressed in dark blue uniforms, Guardians security officers are placed in visible locations...
Highline Financial Services provides three categories of service to its clients. Managing partner Freddie Mack is getting ready to prepare financial and personnel hiring (or layoff) plans for the...
For each of the following sets of numbers, calculate the sample size $(N)$, the mean $\mathrm{X}^{-}$ , the standard deviation $(s)$, and the standard error of the mean $s \mathrm{X}^{-}$: a....
Northern Communications has the following stockholders equity: Requirements 1. Assuming the preferred stock is cumulative, compute the amount of dividends to preferred stockholders and to common...
You are considering an investment in Justus Corporation's stock, which is expected to pay a dividend of $ 2 . 5 0 a share at the end of the year ( D 1 = $ 2 . 5 0 ) and has a beta of 0 . 9 . The risk...
Use information on the endpapers of this book to calculate the average density of the Earth. Where does the value fit among those listed in Tables 1.5 and 14.1? Look up the density of a typical...
Prepare a cash flow statement for Lee Ltd for the year ended 31 December 20X4 as required under FRS 1 using the direct method, together with note 1 to the statement. The profit and loss account,...
Give an example of the information to be included under each of the headings in an FRS 1-based cash flow statement and indicate why this information might be useful. Data from FRS 1 Cash flows...
Rally, Inc., has identified an investment project with the following cash flows. If the discount rate is 8 percent, what is the future value of these cash flows in Year 4? What is the future value at...
A cohort of 10,000 women are screened for breast cancer via mammography. A total of 500 women have a positive mammogram. Upon further study of these 500 only 85 are found to actually have the disease...
What are the emerging roles of non-canonical homeostatic mechanisms, such as microRNA-mediated gene regulation and long non-coding RNAs, in fine-tuning cellular responses to stressors and maintaining...
SHORT-TERM FINANCING AND INTERNATIONAL CORPORATE FINANCE Buddha Tamang is the manager in charge of short-term finance and planning for Exotic Cuisines Inc, a restaurant chain that specializes in...
You need $135,000 to renovate your restaurant and the best simple interest rate you can find was 4.5%. Assume you have 2 years to save. How much money do you need to invest today?
Keats started operation in Mar1 making one product, their standard cost were: $ Direct Labor 5 Direct Material 8 Variable Production OVH 2 Fixed Production OVH 5 Standard Production cost = 20. The...
Return to the original GogglesPlus example in Exhibits. Suppose direct labour is $34,000 rather than $21,250. Now what is the conversion cost per equivalent unit? GogglesPlus SHAPING DEPARTMENT Month...
A copper rod of length L =18.0 in is to be twisted by torques T (see figure) until the angle of rotation between the ends of the rod is 3.08. (a) If the allowable shear strain in the copper is 0.0006...
A business makes a provision for doubtful debts of 3% of debtors, also a provision of 1% for discount on debtors. On 1 January 20X8 the balances brought forward on the relevant accounts were...
John Boggis saw a computer for sale in a local store for 1,499. This was much cheaper than hed seen it for sale elsewhere. He needed five of these PCs and also needed the cabling to network them....
A business, which started trading on 1 January 20X7, adjusted its doubtful debt provision at the end of each year on a percentage basis, but each year the percentage rate is adjusted in accordance...
Which job does supportive equity play in compromise, especially in cases including damage or bad behavior, and how might helpful cycles cultivate responsibility, mending, and compromise among...
Lulzbot.com sells 6,000 units of its product for $500 each. The sales price includes a one-year warranty on parts. 3% of units are expected to be defective and repair costs are expected to average...
The general ledger of Karlin Company, a consulting firm, as of January 1, 2018, contained the following account balances: Account Title Debits Credits Cash 30,200 Accounts Receivable 15,500 Equipment...

When the items needed for the additional information required by the direct method are so easy to

Question:

Step by Step Answer:

In principle the direct method is very easy to calculate You just add up a...View the full answer

Frank Woods Business Accounting Volume 2

Students also viewed these Business questions