Difference between revisions of "Prepare a Statement of Cash Flows"
m (Update ref tag) |
m (Text replacement - "== Video ==" to "") |
||
| (4 intermediate revisions by the same user not shown) | |||
| Line 1: | Line 1: | ||
A statement of cash flows is one of the four major financial statements prepared by corporations at the end of each accounting period (the others being a [[Write a Balance Sheet|balance sheet]], [[Write an Income Statement|income statement]], and [[Calculate Retained Earnings|statement of retained earnings]]). The goal of the cash flow statement is to provide an accurate picture of the cash inflows, outflows, and net changes of cash during the accounting period. The statement is prepared by calculating net changes to cash from operating, investing, and financing activities. The total increase or decrease in cash for the current year is added to the ending cash from the prior year to calculate the ending cash and cash equivalents for the current year. | A statement of cash flows is one of the four major financial statements prepared by corporations at the end of each accounting period (the others being a [[Write a Balance Sheet|balance sheet]], [[Write an Income Statement|income statement]], and [[Calculate Retained Earnings|statement of retained earnings]]). The goal of the cash flow statement is to provide an accurate picture of the cash inflows, outflows, and net changes of cash during the accounting period. The statement is prepared by calculating net changes to cash from operating, investing, and financing activities. The total increase or decrease in cash for the current year is added to the ending cash from the prior year to calculate the ending cash and cash equivalents for the current year. | ||
| − | [[Category:Marketing]] | + | [[Category: Marketing]] |
== Steps == | == Steps == | ||
| Line 49: | Line 49: | ||
#*Keep in mind that cash flow analysis is only a small part of analyzing a company's financial health. A net decrease in cash might also be concurrent with a major investment in the company's future growth. Similarly, a net increase in cash might reflect that management is getting lazy about reinvesting in the company. | #*Keep in mind that cash flow analysis is only a small part of analyzing a company's financial health. A net decrease in cash might also be concurrent with a major investment in the company's future growth. Similarly, a net increase in cash might reflect that management is getting lazy about reinvesting in the company. | ||
| − | + | ||
| − | + | ||
==Related Articles== | ==Related Articles== | ||
