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<strong>ACCT</strong> <strong>304</strong> <strong>DeVry</strong> <strong>Week</strong> 3 <strong>Complete</strong> <strong>Work</strong> <strong>Latest</strong><br />
<strong>ACCT</strong> <strong>304</strong> <strong>DeVry</strong> <strong>Week</strong> 3 DQ 1 Income Statement<br />
Students often refer to an income statement as the statement that shows how much money a company has made.<br />
Money, by definition, is something that is generally accepted as a medium of exchange or means or payment. Keeping<br />
that definition in mind, an income statement is not a measure of money, but rather it is a measure of net income (or<br />
loss) also known as profit (or loss). Select a publicly held company like Apple, Microsoft, IBM, Hewlett Packard, Home<br />
Depot (Note: do not select a company already chosen by your classmate). Go to their website and select Investor<br />
Relations and there you will find the company’s annual report. Provide the link to that annual report and based on what<br />
you have read about income statements in this chapter and in the Becker materials, tell us what you have learned<br />
about the company from reviewing its income statement.<br />
This section lists options that can be used to view responses.<br />
<strong>ACCT</strong> <strong>304</strong> <strong>DeVry</strong> <strong>Week</strong> 3 DQ 2 Cash-Flow Statement<br />
The Statement of Cash Flows has historically given students a lot of heartburn, but it really isn't that scary. A cash-flow<br />
statement, simply stated, reports the uses (where the cash was spent) and the sources (where the cash came from) of<br />
cash during a period. Let's start with a very simplistic set of facts. I run a CPA firm, and I billed my clients $50K during<br />
the month of February. To earn that $50K, I incurred $20K of wage expense and another $10K of overhead (rent,<br />
utilities, insurance, etc.). So I made $20K profit, right? So I am sitting pretty? Not necessarily. What if I now tell you that<br />
$40K of my billings have yet to be collected? And my E&O insurance carrier increased my premium and I had to prepay<br />
$10K of premiums this month. How does my cash flow differ from my profit? Will these transactions appear on my<br />
income statement? My cash-flow statement?<br />
<strong>ACCT</strong> <strong>304</strong> <strong>DeVry</strong> <strong>Week</strong> 3 Quiz<br />
(TCO 5) The difference between single-step and multiple-step income statements is primarily an issue of<br />
consistency.<br />
presentation.<br />
measurement.<br />
valuation.
Question 2. Question : (TCO 5) On August 1, 2011, Rocket Retailers adopted a plan to discontinue its catalog sales<br />
division, which qualifies as a separate component of the business, according to GAAP, regarding discontinued<br />
operations. The disposal of the division was expected to be concluded by June 30, 2012. On January 31, 2012, Rocket's<br />
fiscal year end, the following information relative to the discontinued division was accumulated:<br />
In its income statement for the year ended January 31, 2012, Rocket would report a before-tax loss on discontinued<br />
operations of<br />
$115,000.<br />
$195,000.<br />
$65,000.<br />
$125,000.<br />
Question 3. Question : (TCO 5) Changes in accounting estimates are reported<br />
currently and prospectively.<br />
retroactively and currently.<br />
retroactively, currently, and prospectively.<br />
by restating prior years.<br />
Question 4. Question : (TCO 5) Which of the following is added to net income as an adjustment under the indirect<br />
method of preparing the statement of cash flows?<br />
Salaries payable decrease<br />
Gain on the sale of land<br />
Loss on the sale of equipment<br />
Accounts receivable increase<br />
Question 5. Question : (TCO 5) Review Rowdy's Restaurants cash flow (in millions):<br />
Rowdy's would report net cash inflows (outflows) from financing activities in the amount of<br />
$1,100.<br />
$(1,100).<br />
$820.<br />
$900.