You Are the Controller for McBride & Associates

question 5

Essay

You are the Controller for McBride & Associates.Your accounting intern from the local university has been assigned the task of preparing your company's statement of cash flows.The intern has come to you with a question.She is not sure how to report some dividends the company had received during the year.She explains that,on first thought,it seems like dividends represent a financing activity since they are related to shares that companies issue to finance their businesses.But she is having second thoughts.Explain to your intern how dividends (both received and paid)should be classified on the cash flow statement.

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Definitions:

Intellectual Tasks

Activities that require mental effort, cognition, and processing, such as problem-solving and abstract thinking.

Crystallized Intelligence

This refers to the accumulation of knowledge, facts, and skills that one acquires through education and experience.

Fluid Intelligence

The aspect of intelligence involving the ability to reason abstractly, think logically, and solve problems in novel situations, independent of acquired knowledge.

"g" Factor

A term in psychology that refers to the general intelligence factor, believed to represent the common skills and abilities that underlie all intelligent behavior.