lesson12
Dear Jessica,
Thank you for the fourth message. My comments follow.
Sincerely,
Prof. Sue Garreis
Dear Professor Garreis,
Thank you for your corrections of my English.
There is my homework following:
1.Why is the Statement of Cash Flows important to U.S. users of accounting
information?
Cash flow statements are very important to American investors.Stockholders
want the main business of the company to increase cash.Healthy cash flow
means a company receives more cash than it spends. Healthy cash flow makes
the company very stable today.Healthy cash flow lets the company grow in
the future. U.S. investors respond to changes in cash flows. Stockholders
study cash flow to predict dividends and the long-term health of the company.
Most dividends are paid in cash. Liabilities are repaid in cash.
Correct. Both the accounting and English are completely correct.
2. Look at the table that compares the direct and indirect methods.
What is the main difference between the indirect and direct methods:
a. in operating activities?
b. in investing activities?
c. in financing activities?
Direct
Indirect
Operating Activities
Independently analyzes the changes that cash transactions cause in each balance
sheet non-cash account.
Starts with Net Income on the Income Statement. Cash transactions omitted
from income are added. Non-cash transactions included in income are removed.
This is called a "reconciliation to Net Income."
The amount of cash provided by or used by operating activities is the same no
matter which method is used.
Investing Activities
no differences
no differences
Financing Activities
no differences
no differences
Correct. Again, both the
accounting and the English are correct.
3.How do Japanese companies report their changes in cash during the year?
The Japanese companies use the indirect method to report their changes in
cash during the year. You can see the website about Levi Strauss Japan
http://www.levistrauss.co.jp/finance/001_03.html
Correct.
And thank you for the reference to the Japanese Levi Strauss page.
4.How easy was this lesson for you?
Both the accounting, English and getting to and using the linked web
pages were
Thanks
for your feedback.
Sincerely, yours
Jessica