Sources and uses of cash, Cost Accounting

There are different activities undertaken through a business that prove to be either source or use of cash. These can be categorizes under three broad categories that are: investing activities, Financing activities and operating activities. A brief discussion of all of these categories is given below:

Operating  activities  comprise  cash  inflows  related  with  sales,  dividends  and interest  received  and  the  cash  outflows  related  with  operating  expenses comprising payments to  suppliers of  goods or  services, payments in the directions of wages, taxes and interest, etc. Increase or decrease in current assets, for illustration: receivables, inventory and also increase or decrease in current liabilities, for illustration: accounts payable, interest payable, wages payable, taxes payable also reflect operating activities.

Investing activities considered as to long life assets as land and building, plant and machinery and investments. Acquisitions of these assets involve cash outflow while their disposal means inflow of cash.

Financing activities encompass modifications in equity and preference capital, long term loans, debentures and same items. Issuance of equity, debenture and preference capital and also rising of long term loans imply cash inflow. Retirement of capital, redemption of debentures, bonus payments to shareholders, amortisation of long-term loans, conversely are related with cash outflow.

Posted Date: 4/9/2013 1:52:48 AM | Location : United States







Related Discussions:- Sources and uses of cash, Assignment Help, Ask Question on Sources and uses of cash, Get Answer, Expert's Help, Sources and uses of cash Discussions

Write discussion on Sources and uses of cash
Your posts are moderated
Related Questions
Differentiate between Multiple Products, Selling Costs and Margin Management

Which of the four types of costs would include Direct Labor? A. Unit-Level B. Batch-Level C. Product Sustaining D. None of the above

Imperial Sandwich Plc is to be established shortly. The founders are considering their options with regard to capital structure. A total of £5 m will be required to establish the b

Tony Allan Inc is a small manufacturer of metal products in Toronto.  The company rents its factory building.  It uses a job order costing system because it has a wide variety of p

Q. Let a firm's production function be given by K 0.3 L 0.7 . (i) Sketch (without specific numbers) the shape of the long run average and long-run marginal cost curves of the fir

From  the  following  data  write the  standard  cost  card  for  one  unit  of  the  sole  product manufactured.                                    Standard Cost card for One U

Cost Book-Keeping In cost account accounts, extensive employ is made of control accounts that are based in the similar principles as those utilized in financial accounts.  Two

Now along with the illustration of Ramsons at hand, this is not tough for us to understand that Ramsons have invested the 'money to make money'. Where has Ramsons invested the mone


(i) In terms of cashflow, which month will be the most costly for your project? (ii) If the 3rd and 4th months are more expensive by 25% each because the outsourced labour took