U.S. Securities and Exchange Commission (SEC) Web site (www.sec.gov).
• Confirm that the firm's income, dividends, and other capital transactions explain the change in equity for the most recent year. (You may need to consult the statement of shareholders' equity.)
• Confirm that the firm's cash flow statement begins with the same net income amounts found in the income statement.
• Confirm that the firm's cash flow statement shows a change in cash that is equal to the difference between cash shown on the balance sheet at the beginning and end of the year. In" EXCEL", construct a combined income statement and cash flow statement.
• Write 1–2 paragraphs that answer the following:
o What would you do if you found there was a huge difference in the net income amounts and the reported cash flow amounts?
Sample Solution