8/19/2019 cash flow ppt by stud.pptx

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CASH FLOW STATEMENT

8/19/2019 cash flow ppt by stud.pptx

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Introduction. A cash fow statement presents inormation a!out the cash fows

associated with the compan"#s main operations and those associated

with its in$estin% and &nancin% acti$ities o the period

A cash fow statement unctions in con'unction with !oth the incomestatement (perormance dimension) and the !a*ance sheet (&nancia*position)

8/19/2019 cash flow ppt by stud.pptx

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+rimar" +urpose o Statement To pro$ide inormation a!out,

cash receipts

cash pa"ments

the net chan%e in cash resu*tin% rom,

operatin%-

in$estin%

&nancin% acti$ities o a compan" durin% a period

8/19/2019 cash flow ppt by stud.pptx

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8/19/2019 cash flow ppt by stud.pptx

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Operatin% Acti$ities...

  Inc*ude,

 The cash eects o

transactions that createre$enues and e/penses andEnter into determination o

net income.

 nvolve ncome Stateme

tems

8/19/2019 cash flow ppt by stud.pptx

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In$estin% Acti$ities...

  Inc*ude,

Ac0uirin% and disposin% o

in$estments and producti$e*on%1*i$ed assets.Lendin% mone" and

co**ectin% the *oans.

 nvolve nvestments and

Long-Term Asset tems

8/19/2019 cash flow ppt by stud.pptx

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Financin% Acti$ities...

  Inc*ude,

O!tainin% cash rom issuin%

de!t and repa"in% theamounts !orrowedO!tainin% cash rom

stoc2ho*ders and pa"in%

them di$idends.

 nvolve Long-Term Liability and Stockholders’

Equity tems

8/19/2019 cash flow ppt by stud.pptx

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Statement o Cash F*ows He*ps3sers E$a*uate

4. The compan"#s a!i*it" to %enerate uture cash fows.

5. The compan"#s a!i*it" to pa" di$idends and meet o!*i%ations.

6. The reasons or the dierence !etween net income and net cashpro$ided (used) !" operatin% acti$ities.

7. The in$estin% and &nancin% transactions durin% the period.

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Statement o Cash F*ows He*ps Answer theFo**owin% 8uestions

4. How did cash increase when there was a net *oss or the period9

5. How were the proceeds o the !ond issue used9

6. How was the e/pansion in the p*ant and e0uipment &nanced9

7. Wh" were di$idends not increased9

:. How was the retirement o de!t accomp*ished9

;. How much mone" was !orrowed durin% the "ear9

8/19/2019 cash flow ppt by stud.pptx

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Cash fow $ersus pro&t

Cash fow and pro&t are dierent economicphenomena

=ut *in2ed throu%h the mechanisms o accrua*accountin%>

Cash fows are actua* detai*s o incomin% and

out%oin% fows o cash- whi*e the !a*ancesheet and income statement emanate romproessiona* 'ud%ement and are not a directpro'ection o o!'ecti$e economic data

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 Than2 ?ou