The cash flow statement

Résumé du document

It's a financial statement that reflects the inflow of revenue and the outflow of expenses resulting from operating, investing and financing activities during a specific time period.

The cash flow statement is distinct from the income statement and balance sheet because it does not include the amount of future incoming and outgoing cash that has been recorded on credit

Extraits

[...] True False An increase in a current liability means increase in cash decrease in cash decrease in a current asset increase in a current asset The method which reports all cash receipts and cash payments from operating activities is called the: accrual-basis method cash-basis method direct method indirect method An increase in a current asset other than cash means increase in cash decrease in cash decrease in a current liability increase in a current liability Which of the following expenses is not added back to net income under the indirect method of preparing the statement of cash flows? [...]

[...] The cashflow statement Definition It's a financial statement that reflects the inflow of revenue and the outflow of expenses resulting from operating, investing and financing activities during a specific time period The cash flow statement is distinct from the income statement and balance sheet because it does not include the amount of future incoming and outgoing cash that has been recorded on credit Aim of a cash flow statement provide information on a firm's liquidity and solvency provide additional information for evaluating changes in assets, liabilities and equity improve the comparability of different firms' operating performance by eliminating the effects of different accounting methods Who cares about a Cash Flow Statement? [...]

[...] Executives Stockholders Suppliers Investors Employees Format of the Cash Flow Statement The cash flow statement is divided into three sections: Cash flow from operating activities: measuring the cash inflows and outflows caused by core business operations Cash flow from investing activities: associated with purchases and sales of non-current assets Cash flow from financing activities: associated with financing the firm Cash Flow from Operating Activities : Direct method Cash Received From Sales Of Goods And Services - Cash Paid For Operating Goods And Services Cash flows used in operating activities Cash Flow from Operating Activities : Indirect method net income xxx depreciation and amortization xxx Decrease (increase) in accounts receivable xxx Decrease (increase) in inventory xxx Decrease (increase) in Current liabilities xxx Cash flows used in operating activities xxx Cash Flow from investing Activities : Investing activities, cash flows provided by Proceeds From Sale Of Assets Purchases Of Property And Equipment = Total Net Cash used By Investing Activities Cash Flow from financing Activities : Financing activities, cash flows provided by or used in: + Increase (decrease) in debt - Dividends paid + Sale (repurchase) of stock =Total Net Cash used By financing Activities The cashflow statement net income xxx + depreciation and amortization xxx + Decrease (increase) in accounts receivable xxx + Decrease (increase) in current liabilities xxx + Decrease (increase) in inventory xxx Cash flows used in operating activities xxx + Proceeds From Sale Of Assets xxx - Purchases Of Property And Equipment xxx Total Net Cash used By Investing Activities xxx + Increase (decrease) in debt xxx - Dividends paid xxx + Sale (repurchase) of stock xxx Total Net Cash used By financing Activities xxx Net increase (decrease) in cash and cash equivalents xxx Cash and cash equivalents at beginning of period xxx Cash and cash equivalents at end of period xxx Where To Enter The Balance Sheet Changes A change in this balance sheet category Current Assets Current Liabilities Long-term Assets Long-term Liabilities Stockholders' Equity . is reported in this section of the cash flow statement Operating Activities Operating Activities Investing Activities Financing Activities Financing Activities Understanding the changes in cash More companies use the direct method of presenting the operating activities section of the statement of cash flows. [...]