What Is a Normative Statement? Give an Example

question 401

Essay

What is a normative statement? Give an example.

Assess and calculate the cash flow to shareholders and creditors.

Recognize the importance and calculation of non-cash expenses in financial analysis.

Analyze and compute net working capital and its changes over time.

Understand the process and implications of capital cost allowance and its effect on asset valuation.

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Definitions:

Revenue

Income that a business receives from its normal business activities.

Recorded

The action of documenting financial transactions in accounting records to keep an accurate and organized track of a company's financial activities and position.

Cash Received

The total amount of money, including cash, checks, and electronic transfers, that is received by a business during a specified period.