1. From the statement of cash flows, name the journal(s) or journal summaries in
ID: 2584036 • Letter: 1
Question
1. From the statement of cash flows, name the journal(s) or journal summaries in which you would expect to find the following transactions recorded a. Receipts from customers Payments to suppliers and employees Dividends paid to members of the parent entity b. C. d. Payments for property, plant and equipment 2. From the statement of cash fows,namehe jouma) or journal summaries in which you would expect to find the following transactions recorded: (12 marks) a. Receipts from customers b. Payments to suppliers and employees c. Dividends paid to members of the parent entity d. Payments for property, plant and equipment 3. From the financial statements and notes in relation to revenues and expenses, name the journal (s) or journal summaries in which you would expect to find the following transactions recorded a. b. C. d. cost of sales expense sales and marketing expense. other income occupancy expenseExplanation / Answer
1) a) Receipt from customers = This transaction is shown as a part of operating activities in cash flow statement because the receipt from customers is in relation to sales and sales are main operating activity of the business.
b) Payment to suppliers and employees = This transaction is shown as a part of operating activities in cash flow statement because it is directly related to sale of business.
c) Dividends paid to members of parent entity = This transaction is shown as a part of Financing activities in cash flow statement because dividend is distributed to common stockholders and common stock is a source of finance for organization.
d) Payments for Property, Plant and Equipment = This transaction is shown as a part of Investing activities in cash flow statement because purchase of long term assets is a long term investing activity.
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