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statement of financial position
CURRENT ASSET
Investment (20X8) 143 (20X7) 46Cash (20X8) 29 (20X7) 117
CURRENT LIABILITY
Bank overdraft (20X8)132 (20X7) 54note : The current asset investment are government bond and management has decided to class them as cash equivalent.
requirement :
1)Cash and cash equivalent b/f
2)Cash and cash equivalent c/f
sir plz show the working so that i can understand how you have did it
Brought forward 46 + 117 – 54 = 109
Carried forward 143 + 29 – 132 = 40
Does that agree with the printed solution?
Your post says:
“The current asset investment are government bond and management has decided to class them as cash equivalent”
So that’s why I used the investment bond – it’s a cash equivalent and the questions you asked were for “Cash and cash equivalent b/f” and “Cash and cash equivalent c/f”
Am I not correct that only part of the investment in example 6 was a cash equivalent?
i want to know in the statement of cash flow under operating activity, on which basis do we account for the cash flow
income – based on cash basis (means until we receive cash in hand we won’t account for the income)
expense – based on acrual basis
i am just trying to be sure,sir
A statement of cash flow attempts to take the accruals-based results of an entity and convert those results into cash-based figures
So we start with “Profit before tax” which is obviously an accruals-based figure and we convert it into cash-based figures
Does that answer your question?
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