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

13. Statement of Cash Flows

Introduction to the Statement of Cash Flows

Financial Accounting

13. Statement of Cash Flows

Introduction to the Statement of Cash Flows

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Multiple Choice

Which of the following is required in creating a statement of cash flows?

Excluding cash equivalents from the statement

Reporting only cash inflows and ignoring cash outflows

Classification of cash flows into operating, investing, and financing activities

Listing all non-cash transactions as cash inflows

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Verified step by step guidance

Understand the purpose of the statement of cash flows: It is designed to provide information about a company's cash inflows and outflows during a specific period, categorized into operating, investing, and financing activities.

Learn the three main classifications: Operating activities include cash flows from the core business operations, investing activities involve cash flows related to the acquisition or disposal of long-term assets, and financing activities include cash flows related to borrowing, repaying debt, or issuing equity.

Recognize that cash equivalents are included: Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and are included in the statement of cash flows.

Understand the treatment of non-cash transactions: Non-cash transactions, such as issuing stock for assets or converting debt to equity, are disclosed in the notes to the financial statements rather than being listed as cash inflows or outflows.

Ensure proper classification and reporting: When preparing the statement of cash flows, classify each cash flow into the appropriate category (operating, investing, or financing) and exclude non-cash transactions from the main statement.