Direct and Indirect Methods The comparative balance sheets and income statement of Piura Manufacturing follow.
Additional transactions for 2012 were as follows: a. Cash dividends of $8,000 were paid. b. Equipment was acquired by issuing common stock with a par value of $6,000. The fair market value of the equipment is $32,000. c. Equipment with a book value of $12,000 was sold for $6,000. The original cost of the equipment was $24,000. The loss is included in operating expenses. d. Two thousand shares of preferred stock were sold for $4 per share.
1. Prepare a schedule of operating cash flows using (a) the indirect method and (b) the direct method.
2. Prepare a statement of cash flows using the indirect method.
3. Prepare a statement of cash flows using a worksheet similar to the one shown in Cornerstone 15-8 (p. 643).
4. Form a group with two to four other students, and discuss the merits of the direct and indirect methods. Which do you think investors might prefer? Should the FASB require all companies to use the direct method?
The reinforced concrete ‘slab on ground’ flooring system for the 2 storey dwelling detailed in the plans is to be constructed utilising expanded polystyrene void formers...Jul 09 2020
Jill is wishing to accumulate $21,000 for a renovation in 4 years’ time. To do this, she will make 16 deposits (quarterly) with the first deposit today. If she can earn 1...Apr 13 2021
Enter the appropriate data into the WinQSB – Pert program. You may do this in either graphical or matrix form. The name of the problem is YOUR NAME. Print out either the ...Aug 10 2020
AFN equation Broussard Skateboard's sales are expected to increase by 15% from $7.4 million in 2015 to $8.51 million in 2016. Its assets totaled $5 million at the end of...Dec 02 2019
Currently most health insurance operates on a fee-for-service payment schedule However, with healthcare’s ever-evolving structure, perhaps a different model would be mo...Mar 19 2020
What potential cost-savings advantages might firms experience using outsourcing? What are the possible benefits and possible downside to outsourcing? Any moral issues or ...Jun 14 2020
A long 8-cm-diameter steam pipe whose external surface temperature is 90°C passes through some open area that is not protected against the winds. Determine the rate of he...Jul 20 2020
Jill is planning the timing of her on-the-job training investments over the life cycle. What happens to Jill?s OJT investments at every age if (a) the market-determined r...Apr 30 2020
Pseudogenes are important to evolution because (A) They are silent genes that have been activated by mutations (B) They did not exist until recently (C) They occur ...Mar 15 2018
A 10 kHz pulse waveform consists of pulses that are 10 μs wide. Its duty cycle is(a) 100%(b) 10%(c) 1%(d) Not determinableAug 06 2020