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| Topic: |
Business
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| Number of pages / Number of words: |
3 / 757 |
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(Kieso, et al., 2004)
The statement of cash flows also helps the users to see the reasons for the difference between net income and cash flow from operating activities. With accrual basis accounting, various estimates are made. This leads to the question, “How reliable is the net income? Again, because the statement of cash flows shows adjustments to the accrual method, users can judge for themselves about whether or not to depend on the net income figure given...
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(Kieso, et al., 2004)
Another thing that the statement of cash flows helps the user see is the cash as well as the noncash investing and financing activities during the time frame of the statement. For example, when a company purchases or sells assets that are not included in its product line, borrows or repays loans, the statement of cash flows will disclose this information...
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