Statement of Cash Flows - handout

Statement of Cash Flows - handout - Problem Day Today A...

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Problem Day Today – A review of the Statement of Cash Flows!
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What’s important: Net Income  or Cash Flow? Suppose a firm shows a $16,000 increase  in the cash position from one year to the  next? Where did the cash come from? Analyzing all the sources and uses of  cash reveals a lot about a firm’s health.
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Statement of Cash Flows Cash is King!! Breaks cash flows into 3 sources:  Operations, Financing, and Investing
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Simplified Income Statement - 2007 Three Dudes, Inc (Assume taxes paid at enterprise level) Revenue $1,400,000 Cost of Services (490,000) Gross Profit $910,000 $280,000 Earnings before interest and taxes (EBIT) $630,000 Interest charges: $27,000 Earnings before taxes (EBT) $603,000 Taxes ($271,350) Net Income $331,650
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    Assets: 2003          2002 2003 2002     Cash 32,000         16,000 Accts Pay 32,000             28,000     Accts. Rec. 225,000         200,000 Notes Pay  30,000             30,000    Inventories
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This note was uploaded on 10/23/2011 for the course BUS M 301 taught by Professor Jimbrau during the Fall '11 term at BYU.

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Statement of Cash Flows - handout - Problem Day Today A...

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