Accounting-Basics英语会计基础教学课件(10)

182,500
305,500
Prepayments
8,000
9,500
Interest receivable
1,000
1,500
Plant & equipment
207,000
300,000
Accum. Depreciation – PP&E
(27,000)
(55,500)
Total assets
621,000
LO1
•A statement of cash flows provides information about an entity’s cash receipts and cash payments during a period
•It answers the questions:
• Where did the cash come from during the period? • What was the cash used for during the period? • What was the change in the cash balance during
•Current asset and current liability transactions normally result from the operating activities of a company, such as buying and selling merchandise.
Investing activities
Issuing shares and other
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include: Issuing bonds and other Repay bonds and other
borrowings
borrowings
• Prepare a statement of cash flows using the direct method
• Statement of cash flows- the indirect method
3
STATEMENT OF CASH FLOWS: USEFULNESS AND FORMAT
(List of individual inflows and outflows)
Net cash from (used by) financing activities Net increase (decrease) in cash Cash at beginning of period Cash at end of period
Lend money to other parties
Financing activities
Transactions between a
company and its owners or beCatswh einfelonws afromc…ompCaanshyouatflnowds tiot…s
TOTAL REVENUE
527,500
Cost of goods sold
276,300
Depreciation – plant & equipment
38,500
Other expenses
135,000
TOTAL EXPENSES
450,500
PROFIT BEFORE TAX
77,000
Income tax expense
assets
(PP&E,
intangibles, share
investments)
Acquire non-current assets (PP&E, intangibles, share investments)
Repayments of loans advanced to other parties
Listed elsewhere in the financial statement Material non-cash investing and financing activities (List of individual non-cash transactions)
xx xxx
xs of the statement of cash flows
• Helps investors, creditors and other interested parties to evaluate the following about the entity:
A Ltd Statement of Comprehensive Income for the year ending 30 June 2011
Sales revenue
520,000
Interest revenue
4,300
Gain on sale of plant & equipment
2,500
xx xxx
xxx xxx xxx
xxx
11
Preparing the statement of cash flows
There are 3 sources of information to prepare the statement of cash flows:
1 Comparative statements of financial position 2 Current income statement 3 Additional information (about transactions that
52,500
PROFIT FOR THE YEAR
24,500
A Ltd comparative Statements of Financial Position
2010
2011
Cash at bank
152,000
3,000
Accounts receivable
97,500
180,000
Inventory
The acquisition/disposal of long-term assets and other investments during a financial period.
. Examples include:
Cash inflows from…
Cash outflows to…
Sale of non-current
• Financing activities
• Cash effects resulting from long-term borrowing and shareholders’ equity
6
Operating activities
•Are transactions involving the acquisition or production of goods and services and the sale and distribution of these goods and services to customers.
Net cash from (used by) operating activities Cash flows from investing activities
(List of individual inflows and outflows)
Net cash from (used by) investing activities Cash flows from financing activities
Accounting-Basics英语会计基础教 学课件(10)
2
Learning Objectives
• Indicate the usefulness of the statement of cash flows
• Distinguish among operating, investing and financing activities
Statement of comprehensive income Statement of financial position Additional information
Required: Prepare the statement of cash flows of A Ltd
for the year ending 30 June 2011 (using the direct method of disclosure for cash flows from operating activities)
Pay dividends (cash dividend)
9
Significant non-cash activities
• Significant financing and investing activities that do not affect cash are not reported in the body of the statement of cash flows, but are disclosed elsewhere in the financial statement
• Ability to generate future cash flows • Ability to pay dividends and meet obligations • Reasons for difference between profit and net
cash provided (used) by operating activities • Cash investing and financing transactions for the