cash flow from operations 150. = net income plus noncash expenses minus noncash revenues 200 + 55 - 30 - 25 = 200
An accounting entry is not necessary for a stock split. Instead, more new shares are issued in order to replace and retire all of the existing shares.
In general, when revenue is earned and realizable, it is recognized.
The liability associated with notes payable is a result of financing activities. Usually, interest is used to cover liabilities that result from financing activities. In contrast, liabilities that result from normal business operations do not involve the extension of interest-bearing credit and instead arise from the "course of business.
When financial statements aren't prepared in accordance with generally accepted accounting principles and it significantly affects how fairly they're presented, an unfavorable opinion is given.
The treasury stock method presupposes that all outstanding options and warrants will be exercised at the start of the period or, if later, at the time of issuance. It also assumes that the common stock was bought with the exercise's proceeds at the time's average market price.
A financing activity is the payment of a cash dividend to stockholders as a return on their investment.
All of the answers are considered to be cash inflows from investing activities.
All remaining responses constitute cash flows from financing activities.
The price paid over the fair market value of the target company's assets is referred to as goodwill. Only Goodwill created during acquisitions is allowed to be capitalized under US GAAP; internally created Goodwill is not permitted.
The following details regarding dividends and interest are crucial to keep in mind:
‥ Dividends from stock investments are regarded as operating cash flows.
‥ Equity dividend payments are regarded as financing cash flows.
‥ Debt-related interest payments are regarded as operating cash flows.
‥ Debt investment interest is regarded as an operating cash flow.
Any net income not distributed during a given accounting period is deposited into the "retained earnings" account.
The goal of the basis EPS formula is to calculate earnings per share of common stock for the total number of the year's outstanding common shares. Because of this, preferred dividends are excluded from the denominator, which instead uses the weighted average number of outstanding common shares.
Accounts receivable's net realizable value is calculated by deducting an allowance for non-collectible items from the total amount owed. Companies typically report receivables at their net realizable value.
A contra account to the fixed asset account is accumulated depreciation (s)
These references do not constitute a disclaimer or an opinion that is qualified or negative; therefore, the language refers to an opinion that is not qualified.
