Explain How the Following Transactions Should Be Reported in the Statement

question 62

Essay

Explain how the following transactions should be reported in the statement of cash flows, assuming the indirect method is used to determine cash flows from operating activities. Identify all available options. If not reported on the statement of cash flows, indicate the disclosure requirements, if any.
1. An increase in allowance for bad debts by $18,000.
2. A principal payment of $35,000 on a lease liability subsequent to the commencement date of the lease.

Learn about the flow of energy and the cycling of matter in maintaining life.

Understand the factors limiting aquatic ecosystems.

Identify and describe the different ecological regions and their characteristics.

Understand the processes of energy conversion in ecosystems including photosynthesis and chemosynthesis.

---

Definitions:

Accounts Receivable

Outstanding amounts due to a firm from customers for goods or services already delivered.

Cost of Goods Sold

Costs directly associated with the manufacturing of products that a business sells.

Collection Period

The standard timeframe for a corporation to collect receivables from its clientele.

Receivables Period

is the average number of days it takes for a business to collect payments from its customers after a sale has been made, indicating the efficiency of its credit and collection policies.