AFM101 Lecture Notes - Cash Flow Statement, Cash Cash, Retained Earnings

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lemoncoyote675

16 Oct 2011

School

University of Waterloo

Department

Accounting & Financial Management

Course

AFM101

Professor

Duane Kennedy

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AFM101 Full Course Notes

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Financial statements: primary means to communicate financial information to parties outside of the organization. Creditors : the companies or people who lend the money to the company. Investors : the companies that buy the corporation or individuals who buy small percentages of the corporation. Dividends: to receive a portion of the company"s earnings in the form of cash payments. Financing activities: the money exchange between the corporation(owners) and its lenders. Investing activities: when the corporation sells or buys property or other stuff. Suppliers: the companies that the corporation gets all its accessories and ingredients and everything the corporation needs to produce its product. Accounting: is a system that collects and processes ( analyzes, measures, and records ) financial information about an organization and reports that information to decision makers. Managerial management accounting : developing accounting information for internal decision makers (detailed plans and continuous performance reports )

Related Questions

QUESTION 1 The knowledge of financial accounting can assist people with decisions such as whether to extend credit to a business. True False 0.2 points Saved QUESTION 2 Employees of a company would not have a reason to use the information provided by financial accounting. True False 0.2 points Saved

QUESTION 3 Financial accounting should be used for assessing the financial health of large organizations only. True False 0.2 points Saved

QUESTION 4 Financial accounting can be helpful for a job candidate who is assessing the financial future of a potential employer. True False 0.2 points Saved QUESTION 5 Lenders might use the information produced by financial accounting when making loan decisions. True False 0.2 points Saved

QUESTION 6 Credit analysts prefer not to use information provided by financial accounting, as it is not accurate. True False 0.2 points Saved

QUESTION 7 Financial accounting is helpful to investment advisors. True False 0.2 points Saved

QUESTION 8 Financial accounting is more useful than managerial accounting. True False 0.2 points Saved

QUESTION 9 The decision to buy or rent equipment is an example of a decision aided by managerial accounting. True False 0.2 points Saved

QUESTION 10 Which of the following statements is true of financial accounting? A. It is used by external parties to make investment decisions. B. It is used to make lease or purchase decisions. C. Managerial accounting is another name for financial accounting, D. It is primarily used to make internal decisions of a business. E. The effectiveness of advertising can be judged using financial accounting. 0.2 points Saved QUESTION 11 The charge for using money over time, often associated with long-term loans, is known as: A. interest. B. principal. C. distribution charge. D. cash dividend. E. preferred dividend. 0.2 points Saved QUESTION 12 Which of the following is a common feature of financial and managerial accounting? A. Both have same objectives B. Both are prepared according to U.S. GAAP C. Both are reported at year end in the annual report D. Both are analyzed by external users while making investment decisions E. Both are used by the management in making decisions 0.2 points Saved

QUESTION 13 Dividends are required to be paid to stockholders on an annual basis. True False 0.2 points Saved

QUESTION 14 An individual who owns one or more shares of stock in a corporation is an owner of that corporation. True False 0.2 points Saved

QUESTION 15 Corporations do not exist as separate legal entities apart from their owners. True False 0.2 points Save Answer

QUESTION 16 It is very difficult to buy or sell ownership shares of a corporation in a stock exchange. True False 0.2 points Saved

QUESTION 17 Stock markets match up investors who wish to buy shares with those who wish to sell them. True False 0.2 points Saved

QUESTION 18 Legal process by which owners of an organization apply to a state government to have it identified as an entity legally separate from its owners is called: A. stocking. B. filling. C. attributing. D. registration. E. incorporation. 0.2 points Saved

QUESTION 19 An advantage of ownership in a sole proprietorship over ownership in a corporation is: A. tax benefits. B. having a board of directors. C. the ability to raise capital through issuance of stock. D. separation of owner and business as legal entities. E. limited liability for debts. 0.2 points Saved

QUESTION 20 Who hires the management of a corporation? A. Stockholders B. Board of directors C. Creditors D. Government E. SEC 0.2 points Saved QUESTION 21 Inventory refers to the: A. excess amount paid for an asset over its fair value. B. intangible assets of a business. C. merchandise bought or manufactured for the purpose of selling. D. amount of net income reinvested by company for future operations. E. revenue generated from investment. 0.2 points Saved QUESTION 22 Investors use financial information to predict whether a: A. company will recruit more employees. B. company's stock price will increase C. company has invested in buildings. D. company will pay salaries. E. company's bond price will increase. 0.2 points Saved

QUESTION 23 Financial accounting can be compared to a portrait. True False 0.2 points Saved

QUESTION 24 Financial statements provide the form and structure for the conveyance of financial information that will create a likeness of the reporting organization. True False 0.2 points Saved

QUESTION 25 The information reported in financial statements must be exact for an investor to make any decision. True False 0.2 points Saved

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Primary responsibility for the information in a corporation's financial statements rests with the shareholders of the corporation. the managers of the corporation. the Securities and Exchange Commission. the certified public accountant who audited the financial statements.

1 )

The following events occurred last year at Dorder Corporation:

Purchase of plant and equipment	$26,000
Sale of long-term investment	$11,000
Dividends received on long-term investments	$7,000
Paid off bonds payable	$14,500
Depreciation expense	$13,000

Based on the above information, the cash provided (used) by investing activities for the year on the statement of cash flows would net to:

Last year Burch Corporation's cash account decreased by $33,000. Net cash provided by investing activities was $8,800. Net cash used in financing activities was $29,500. On the statement of cash flows, the net cash flow provided by (used in) operating activities was:

McCorey Corporation recorded the following events last year:

Repurchase by the company of its own common stock	$27,000
Sale of long-term investment	$46,000
Interest paid to lenders	$8,500
Dividends paid to the company's shareholders	$56,000
Collection by McCorey of a loan made to another company	$32,000
Payment of taxes to governmental bodies	$18,500

On the statement of cash flows, some of these events are classified as operating activities, some are classified as investing activities, and some are classified as financing activities.

Based solely on the information above, the net cash provided by (used in) investing activities on the statement of cash flows would be:

AFM101 Lecture Notes - Cash Flow Statement, Cash Cash, Retained Earnings

AFM101 Full Course Notes

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