內(nèi)容會(huì)計(jì)英語2014-雙789

1、Lesson 9Statement of Cash FlowsYE SUN AccountingEnglish1YE SUN AccountingEnglish2Cash and Cash Equivalents現(xiàn)金和現(xiàn)金等價(jià)物CashCurrencyCash EquivalentsShort-term, highly liquid investments.Readily convertible into cash.So near maturity that market value is unaffected by interest rate changes.YE SUN Accountin

2、gEnglish3Purpose of the Statement of Cash FlowsProvides information about the cash receipts and cash payments of a business entity during the accounting period. Helps investors with questions about the companys:Ability to generate positive cash flows.Ability to meet its obligations and to pay divide

3、nds.Need for external financing.Investing and financing transactions for the period. YE SUN AccountingEnglish4YE SUN AccountingEnglish5Classification of Cash FlowsThe Statement of Cash Flows must include the following three sections:Cash Flows from Operating 經(jīng)營 ActivitiesCash Flows from Investing 投資

4、ActivitiesCash Flows from Financing 籌資ActivitiesYE SUN AccountingEnglish6Outflows to:Suppliers of merchandise and services.Employees.Lenders for interest.Governments for taxes.Inflows from:Sales to customers. Operating ActivitiesYE SUN AccountingEnglish7 Investing ActivitiesInflows from:Selling inve

5、stments or plant assets.Collecting of principal on loans.Outflows to:Acquire plant assets.Purchase debt or equity investments.Make loans.Cash Flows from Investing Activities+_YE SUN AccountingEnglish8 Financing ActivitiesInflows from:Short-term and long-term borrowing.Owners (for example, from issui

6、ng shares).Outflows to:Repayments of borrowed funds.Owners for dividends.Purchase treasury stock.Cash Flows from Financing Activities+_YE SUN AccountingEnglish9The operating cash flows section can be prepared using either the direct method or the indirect method.YE SUN AccountingEnglish10Lets look a

7、t the Direct Method for preparing the Statement of Cash Flows.Direct Method 直接法YE SUN AccountingEnglish11Accrual basis revenue includes sales that did not result in cash inflows.Can be computed as:Revenue, Cash basisDecrease in receivablesIncrease in receivables+ = = Revenue, Accrual basisDirect Met

8、hodCash Received from CustomersYE SUN AccountingEnglish12+ = = The A/R balance was $40,000 on 1/1/11 and $52,000 on 12/31/11. If accrual sales revenue for 2011 was $800,000, what was cash basis revenue?Revenue, Cash basisDecrease in receivablesIncrease in receivablesRevenue, Accrual basis $800,000Di

9、rect MethodCash Received from CustomersYE SUN AccountingEnglish13Revenue, Cash basis $788,000Decrease in receivables$12,000 Increase in receivables+ = = Revenue, Accrual basis$800,000The A/R balance was $40,000 on 1/1/11 and $52,000 on 12/31/11. If accrual sales revenue for 2011 was $800,000, what w

10、as cash basis revenue?YE SUN AccountingEnglish14Now that we understand the process, lets look at some simplified formulas for computing direct method cash flows.YE SUN AccountingEnglish15Direct MethodInterest and Dividends ReceivedYE SUN AccountingEnglish16Direct MethodCash Paid for MerchandiseStep

11、1Step 2YE SUN AccountingEnglish17Direct MethodCash Paid for MerchandiseCost of Sales +/- inventory +/- accounts payableOr cash paid for supplies=-COS +/- inventory(-/+) +/- accounts payable(+/-)YE SUN AccountingEnglish18Direct MethodCash Paid for MerchandiseHow much did Lug Lite pay for inventory in

12、 2011?a. $900,000b. $923,000c. $947,000d. $877,000YE SUN AccountingEnglish19Direct MethodCash Paid for MerchandiseHow much did Lug Lite pay for inventory in 2011?a. $900,000b. $923,000c. $947,000d. $877,000Cos - inventory + A/P changes changes-900 -35 +12= -923kYE SUN AccountingEnglish20Direct Metho

13、dCash Payments for ExpensesAfter deducting depreciation and other noncash expenses, the cash paid for expenses is affected by(1) whether the expense was prepaid, and(2) whether the expense was accrued. YE SUN AccountingEnglish21Indirect MethodNet eCash Flows from Operating ActivitiesChanges in curre

14、nt assets and current liabilities as shown on the following table.+ Losses and - Gains+ Noncash expenses such as depreciation and amortization.YE SUN AccountingEnglish22Use this table when adjusting Net e to Operating Cash Flows.Indirect MethodDetermining investing activitiesCash +/-Long-term assets

15、 -/+Opening + new purchases old disposal depreciation = closing carrying value of fixed assetsYE SUN AccountingEnglish23Determining financing activitiesCash +/-Long-term liabilities +/- (mostly) AND short-term borrowing*+/-Owners equity +/-Opening RE + profit dividend = closing REYE SUN AccountingEn

16、glish24ExampleDIRECT METHODThe direct method does not reconcile net e with cash flow from operations. Instead, the operating section listscash paid and cash receivedfor all e statement items. JUAREZ COMPANY Comparative Balance Sheet Change Assets 20 x1 20 x0 Increase/Decrease Cash $ 191,000 $ 159,00

17、0 $ 32,000 Increase Accounts receivable 12,000 15,000 3,000 Decrease Inventory 170,000 160,000 10,000 Increase Prepaid expenses 6,000 8,000 2,000 Decrease Land Equip Accumulated Dep equip 140,000 160,000 (16,000) - 80,000- -0- 0 60,000 Increase 160,000 Increase 16,000 Increase Total $ 663,000 $ 422,

18、000 Liabilities and Stockholders Equity Accounts payable $ 52,000 $ 60,000 $ 8,000 Decrease Accrued expenses payable 15,000 20,000 5,000 Decrease e taxes payable Bonds payable Common stock 12,000 130,000 360,000 0 0 300,000 12,000 Increase 130,000 Increase 60,000 Increase Retained earnings 94,000 42

19、,000 52,000 Increase Total $ 663,000 $ 422,000 DIRECT METHOD JUAREZ COMPANY e Statement For the Year Ended December 31, 20 x1 Revenues from sales $ 975,000 Cost of goods sold $ 660,000 Operating expenses (excluding depreciation) 176,000 Depreciation expense 18,000 Loss on sale of store equipment 1,0

20、00 855,000 e before e taxes 120,000 e tax expense 36,000 Net e $ 84,000 Additional information: (1) In 20 x1, the company declared and paid a $32,000 cash dividend. (2) Bonds were issued at face value for $130,000 in cash. (3) Equipment costing $180,000 was purchased for cash. (4) Equipment costing

21、$20,000 was sold for $17,000 cash when the book value of the equipment was $18,000. (5) Common stock of $60,000 was issued to ac quire land. DIRECT METHODDIRECT METHODOPERATING ACTIVITIESRevenues from sales$ 975,000Add: Decrease in accounts receivable3,000Cash receipts from customers$ 978,000CASH RE

22、CEIPTS FROM CUSTOMERSIf accounts receivable decreases from one period to another, Cash collections credit sales. Note in each case, the interaction between balance sheet and e statement accountsPAYMENTS TO SUPPLIERSAdjust COGS for the change in inventory to get purchasesAdjust purchases for the chan

23、ge in A/P to get paymentsCost of goods sold660,000Add: increase in inventory10,000Purchases670,000Add: decrease in A/P8,000Cash payments to suppliers678,000Operating expenses are adjusted for changes in Prepaid assets and accrued expensesPAYMENTS FOR OPERATING EXPENSESOperating expenses176,000Deduct

24、: decrease in prepaid expenses(2,000)Add: decrease in accrued expenses payable 5,000Cash payments for operating expenses 179,000Tax expense is adjusted for changes in Prepaid taxes and taxes payablePAYMENTS FOR TAXES e tax expense36,000Deduct: increase in e tax payable(12,000)Cash payments for taxes

25、24,000If tax payable increases during the year, Tax expense cash paid for taxes STATEMENT OF CASH FLOWSDIRECT METHODFor the year ended December 31, 20 x1 STATEMENT OF CASH FLOWSINDIRECT METHODNet e84,000Add depreciation 18,000Add loss on sale of equipment1,000Changes in current assets and current liabilitiesDecreases in ARIncreases in inventoryDecreases in prepaid expenses3,000 -10,0002,000Decreases in AP Decreases in Accrued expense payableIncreases in e tax payable-8,000-5,00012,000Cash flows from operating activities97