CodificationResearch Case Aspart of the year-end accounting process for your company, you are preparing thestatement of cash flows according to GAAP. One of your team, a finance major,believes the...

Codification Research Case

As part of the year-end accounting process for your company, you are preparing the statement of cash flows according to GAAP. One of your team, a finance major, believes the statement should be prepared to report the change in working capital, because analysts many times use working capital in ratio analysis. Your supervisor would like research conducted to verify the basis for preparing the statement of cash flows.

Instructions

If your school has a subscription to the FASB Codification, go to
http://aaahq.org/ascLogin.cfm
to log in and prepare responses to the following. Provide Codification references for your responses.

(a)
What is the primary objective for the statement of cash flows? Is working capital the basis for meeting this objective?

(b)
What information is provided in a statement of cash flows?

(c)
List some of the typical cash inflows and outflows from operations.