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 Statement of

Cash Flows
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 PURPOSE
1. a basis to evaluate the ability of the entity to generate
cash
2. an information on how the entity generates cash
3. an information on how the entity uses cash
4. an information to determine the liquidity and solvency of
the entity
5. an information for estimating future cash inflow and
cash outflow
6. an information for evaluating the relationship between
cash flow and profitability
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 CASH CASH
INFLOW OUTFLOW

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 MAJOR ACTIVITIES OF A COMPANY

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What is the accrual basis of
accounting?
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 INDICATIONS
1. Recognition of Accounts Receivable
2. Recognition of Accounts Payable
3. Recognition of Bad Debts Expense
4. Recognition of Depreciation of
Property, Plant and Equipment
5. Recognition of Prepaid Expense
6. Recognition of Accrued Expenses
7. Recognition of Unearned Income
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 DIRECT VS INDIRECT METHOD

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 DIRECT VS INDIRECT METHOD

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 DIRECT VS INDIRECT METHOD

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 DIRECT VS INDIRECT METHOD

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 DIRECT VS INDIRECT METHOD

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 DIRECT VS INDIRECT METHOD

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 DIRECT VS INDIRECT METHOD

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 CLOSING PRAYER

Lord, may everything we did in our class be blessed with your

inspiration and continue with your saving help. Let everything
we learned find its origin in your wisdom and through you may
we find its purpose in our life, in our home, friends, and our
neighbor today in the future.
We ask this through Jesus Christ our Lord, who lives and reigns
with you in the unity of the Holy Spirit, one God forever and
ever. Amen.
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