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- Title
WORKING PAPER FOR PREPARATION OF CASH-FLOW STATEMENT.
- Authors
Gustafson, Geargz A.
- Abstract
As described herein, the "cash-flow" statement is a broad analysis of the cash account. It is not a statement of cash receipts and disbursements, per se. The purpose is to describe the causes of the net change in the cash balance for the reporting period. The causes of this change in the cash balance are embodied In the business transactions which affected both cash and other accounts-balance sheet, income and expense accounts. By relating the changes, during the reporting period, in the balances of all other accounts to their effect on the cash balance, over-all (net) increase or decrease, the "flow" of cash can be described as "cash used for" or "cash received from." The difference between the totals of items making up these two classifications represents the net change in the cash balance. Although the conventional presentation describes separately the effect of the significant changes of the non-current items (assets and liabilities) on the cash balance, and only broadly the effect of all other accounts, if desired, the individual items of costs and expenses of operation could be separately delineated for emphasis to management of the importance of such items and the effect on cash flow of its past decisions as guides for future planning.
- Subjects
ACCOUNTING; CASH management; CORPORATE finance; FINANCIAL statements; CASH flow; DEBT management; QUICK assets; EXPENSE accounts
- Publication
Accounting Review, 1963, Vol 38, Issue 1, p160
- ISSN
0001-4826
- Publication type
Article