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Mocha cash flow.
there is Investment income in p/l showen 1100 recognised under operating activities but also there is note saying investment income consist of
dividends received-200
profit of sale of investment-400
increase in fv-500
equal–1100so 200 again recognized under investing activity?So if investment income of 1100 recognized under operating activity why do i have to recognise it under investing again?once i remember i asked this question but i forgot again:(
Also is interest received recorded under operating cash flow activities or investing?could you explain in which case it is recognised under operating and investing?
It appears in the statement of profit or loss as an income in arriving at the figure for profit before taxation and interest (expense)
But, in the process of trying to convert the accruals-based profit or loss figures to a statement based on CASH, we need to take these out of operating activities and put them instead into investing activities
You say that investment income of $1,100 is recognised in operating activities
Let me hazard a guess here … when you say it is recognised, you mean that it appears within the operating activities section. Am I correct? Am I also correct in that the figure of $1,100 that is recognised is shown in brackets as a negative amount to be deducted from the figure for profit before taxation and interest?
It is deducted from the operating activities section and shown instead as an addition (cash inflow) within the investing activities section
Does that resolve the issue and eliminate your confusion?
OK?
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