About This Chapter
Statement of Cash Flows - Chapter Summary and Learning Objectives
Developing financial reports is a key part of accounting. The statement of cash flows is the final report for financial statements. This chapter will cover the most essential information involved in these reports. Instructors will narrate short videos and present text lessons aimed at teaching you the methods for creating cash flow statements. Take the quizzes throughout the chapter to gauge your understanding of the topics. In this chapter, you'll learn about topics like:
- What the statement of cash flows is and its importance
- Using the direct and indirect methods for preparing cash flow statements
- How to evaluate patterns in cash flow statements
|The Statement of Cash Flows: Purpose, Format & Examples||Evaluate the components of the statement of cash flows and analyze its importance.|
|Using the Direct Method to Prepare a Cash Flow Statement||Explain the steps involved in the direct method for preparing a cash flow statement.|
|Preparing a Cash Flow Statement by the Indirect Method||Illustrate how to gather the correct information and develop a cash flow statement with the indirect method.|
|Analyzing Cash Flow Statement Patterns||Summarize free cash flow and explain what it means.|
1. The Statement of Cash Flows: Purpose, Format & Examples
There are four financial reports that are required in financial statements. In this lesson, you will learn about the fourth and final report - the statement of cash flows. You'll learn what the makeup of the statement is, its purpose, and why it is important to users of the financial statements.
2. Using the Direct Method to Prepare a Cash Flow Statement
In this lesson, we learn how to use the direct method to prepare a cash flow statement. While it may seem straightforward, we'll see that this method actually requires additional work.
3. Preparing a Cash Flow Statement by the Indirect Method
The vast majority of larger businesses prefer to prepare their cash flow statements using the indirect method. This is because, as we'll see in this lesson, much of the information required is already prepared for them.
4. Analyzing Cash Flow Statement Patterns
The cash flow statement identifies where a company obtained and used cash during a specified period of time. In this lesson, we analyze the patterns conveyed by this statement.
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Other chapters within the Accounting 301: Applied Managerial Accounting course
- Corporate Governance for Managerial Accounting
- Financial Statements & Balance Sheets
- Cost Classifications
- Manufacturing Overhead Cost Allocation
- Job Order Cost System
- Process Cost System
- Activity-Based Costing
- Cost-Volume-Profit Analysis
- Decision Making in Managerial Accounting
- Pricing Objectives & Methods
- Budgetary Control
- Standard Costs
- Capital Budgeting
- Financial Statement Analysis
- Software for Managerial Accounting
- Required Assignments for Accounting 301
- Studying for Accounting 301