Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

1. Introduction to Accounting

The Financial Statements

Financial Accounting

1. Introduction to Accounting

The Financial Statements

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Multiple Choice

According to U.S. GAAP, a statement of cash flows must be presented for:

Only when there is a change in cash balance

Only annual financial statements

Every period for which an income statement is presented

At the discretion of management

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Verified step by step guidance

Understand the purpose of the statement of cash flows: It provides information about cash inflows and outflows during a specific period, helping users assess a company's liquidity, solvency, and financial flexibility.

Review U.S. GAAP requirements: According to U.S. GAAP, a statement of cash flows must be presented for every period for which an income statement is presented. This ensures consistency and transparency in financial reporting.

Clarify the options provided in the problem: Analyze each option to determine its validity based on U.S. GAAP. For example, 'Only when there is a change in cash balance' is incorrect because the statement of cash flows is required regardless of changes in cash balance.

Eliminate incorrect options: 'Only annual financial statements' and 'At the discretion of management' are also incorrect because U.S. GAAP mandates the presentation of the statement of cash flows for all periods with an income statement.

Conclude with the correct answer: The correct answer is 'Every period for which an income statement is presented,' as this aligns with U.S. GAAP requirements for financial reporting.