What is cash flow statement template indirect method?
A cash flow statement template indirect method is a financial statement that provides details about the cash inflows and outflows of a business over a specific period. It shows how the company generates and uses cash through its operating, investing, and financing activities. The indirect method starts with the net income and adjusts it for non-cash expenses and changes in working capital to determine the net cash provided by operating activities.
What are the types of cash flow statement template indirect method?
There are several types of cash flow statement templates available for the indirect method. Some common types include:
Basic Cash Flow Statement Template - This template includes the essential sections required to calculate the net cash provided by operating activities, investing activities, and financing activities.
Detailed Cash Flow Statement Template - This template provides a more comprehensive breakdown of cash inflows and outflows within each category, allowing for a more detailed analysis of the company's cash flow.
Monthly Cash Flow Statement Template - This template is designed to track cash flow on a monthly basis, providing a more granular view of the company's cash flow performance over time.
How to complete cash flow statement template indirect method
Completing a cash flow statement template using the indirect method involves the following steps:
01
Start with the net income figure from the company's income statement.
02
Add back any non-cash expenses, such as depreciation and amortization.
03
Adjust for changes in working capital, including changes in accounts receivable, accounts payable, and inventory.
04
Consider cash flows from investing activities, such as the purchase or sale of assets.
05
Include cash flows from financing activities, such as issuing or repurchasing stock, taking out loans, or paying dividends.
06
Calculate the net cash provided by operating activities by summing up the adjustments made in steps 2 and 3.
07
Determine the net cash provided by investing activities and financing activities by analyzing the cash flow related to those activities.
08
Finally, calculate the overall net increase or decrease in cash by summing up the net cash from operating, investing, and financing activities.
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