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What else can I help you with?
Does capital reserve affect cash flow statement?
NO
How depreciation generated actual cash flows for the company?
It doesn't generate cash flows. It is added back on the Cash Flow Statement because the Cash Flow Statement begins with Net Income, from which depreciation is deducted.
How does Asset revaluation reserve affect cashflow statement. Is it even included in cashflow statement. Or does the increase in freehold property offset the increase in revaluation reserve?
it is included in cash flow statement
What is the general ledger journal entry to begin a Reserve Account?
debit reserve accountcredit cash / bank
Is revaluation surplus included in the cash flow statement?
Revaluation surplus is deducted from net income in case of net cash flow from operations using indirect method as this is not a cash related transaction.
What is the journal entry to purchase asset from general reserve?
General reserves need to be converted into cash first by issuing new shares to share holders and after that cash can be used to purchase assets.
What should be Journal entry for purchase of building from general reserve account?
First of all general reserves need to be converted into cash by issuing new shares and then that cash can be used to purchase building.
Is last year retained earnings consider as cash holdings?
It is cash only if it is appropriated as general reserve. Retained Earnings is a "general term" where the earnings are already used for various activities of the business.
What four general-purpose Financial Statements do business enterprises use?
If I remember this correctly these are Statement of Cash Flows Income Statement Statement of Retained Earnings Balance Sheet
Where does gain on sale of investment belong in the elements of financial statements?
Gain on sale of investment is shown in profit and loss account as well as on cash flow from investing activities as well. While making cash flow statement this needs to be deducted from cash flow from operating activities and needs to be shown in cash flow from investing activities
What is accounting treatment of drawings?
Drawing are goods or cash taken from business by the Owner for this personal use. Drawing of goods will be deducted from the amount of purchases in Income statement and also from the Owner's equity in Balance sheet. Drawing of cash will be just deducted from Owner's equity in balance sheet. Opening Capital Add Profit Add Additional Capital Less Drawings (Cash + Goods) -------------------------------------- = Closing Capital
Why is interest expenses deducted in merger cash flow statements?
Interest expenses are deducted in merger cash flow statements because they represent the cost of financing the acquisition. By excluding these expenses, the cash flow statement can provide a clearer picture of the operational cash flows generated by the merged entity without the influence of financing decisions. This helps stakeholders assess the underlying performance and cash-generating ability of the combined operations. Ultimately, it allows for a more accurate valuation and evaluation of the merger's success.
