Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
12 Cards in this Set
- Front
- Back
CFO
|
reports cash generated from sales and the cash used in the production process. These items essentially flow through the firm's income statement and working capital accounts
|
|
CFI
|
Reports the cash used for property, plant, and equipment; investments, aquisitions, and the cash generated from sale of business or assets
|
|
CFF
|
reports capital structure transactions
|
|
Direct method : Cash collections
|
Net sales + change in A/R + cash advances from customer
|
|
Direct method : Cash inputs
|
-COGS + change in A/P + change in inventory + change other liabilities
|
|
Direct method : Cash expense
|
-wages expense + change wages payable + change in R+D + change in SGA
|
|
Direct method : Cash interest
|
-interest expense + change in interest payable
|
|
Direct method : Cash taxes
|
-taxes expense + change in taxes payable + change in deferred tax
|
|
Indirect method steps
|
1. Begin with NI
2. subtract gains/losses that result from financingor investing activities (usually found on income statement) 3. Add/subtract all noncash charges to income (depreciation + goodwill) 4. Add/subtract changes in operating accounts 5. Calc CFF and CFI |
|
Primary factors causing discrepancies between Operating assets and cash flow statement
|
1. Mergers and aquisitions
2. Exchange rate fluctuations on foreign exhcange |
|
Free cash flow (FCF)
|
=operating cash flows - net capital expenditures
if asked for free cash flow to the firm add back Int X (1-t) |
|
US vs IAS GAAP
|
US GAAP
Dividends paid - CFF Dividends rec - CFO IAS GAAP Div paid - may be CFF or CFO Int. + div rec - may be CFO or CFI Int. pad - may be CFO or CFF |