Cash Flow Plus Flashcards
Calc bonus as a % of income before bonus but after tax
Multi part algebra Bonus = B Tax = T Tax % = x Bonus % = m If: B = m(Income-T) T = x(Income-B) then: B = m(Income - [x(Income-B)]
Statement Changes in Equity
GAAP vs IFRS
IFRS
- Must be separate statement (US allows footnotes or sup. statement as well)
- Must separate non-owner changes
Statement of Cash Flow
Operating Investing Financing Foreign transaction adjustments Change in Cash beg cash end cash Non-cash Inv. and Fin. activities
Statement of Cash Flow
Direct & Indirect
Direct Indirect
Op CF Reconciliation
Inv CF Inv CF
Fin CF Fin CF
Dividend Inc and Interest Income on bonds
Operating Activities
OIF - for Cash Flows
GAAP vs IFRS
Activity IFRS GAAP
Int Paid Op or Fin Op only
Int Rec’d Op or Inv Op only
Taxes paid Op or Fin or Op only
Inv if applies to inv
Div Rec’d Op or Inv Op only
Div Paid Op or Fin Fin only
Cash & eq bank overdraft no
Op/Inv/Fin Cash Flow?
Payment to suppliers
Operating
Op/Inv/Fin Cash Flow?
Interest payment
Operating
Op/Inv/Fin Cash Flow?
Payment to retire bonds
Financing
Op/Inv/Fin Cash Flow?
Downpayment to purchase equipment
Investing
Op/Inv/Fin Cash Flow?
Payment on purchased equipment loan
Financing
Op/Inv/Fin Cash Flow?
Obtain loan on property held as investment
Financing
Op/Inv/Fin Cash Flow?
Purchase of treasury stock
Financing
Op/Inv/Fin Cash Flow?
Depreciation Expense
Not a cash flow
Op/Inv/Fin Cash Flow?
Purchase of trading securities
Operating
Op/Inv/Fin Cash Flow?
Mortgage payment
Operating & Financing (principal & interest)
Op/Inv/Fin Cash Flow?
Dividends on investments
Operating
Op/Inv/Fin Cash Flow?
Loss on disposal of equipment
Not a cash flow
Op/Inv/Fin Cash Flow?
Proceeds from sale of securities available for sale
Investing
Op/Inv/Fin Cash Flow?
Annual lease payment on capital lease
Operating & Financing (principal & interest)
Op/Inv/Fin Cash Flow?
Payment to fund company pension plan
Operating
Op/Inv/Fin Cash Flow?
Increase in A/R
Not a cash flow
Which SCF format? Direct/NonDirect/Both?’
Proceeds from sale of land held as investment
Both
Which SCF format? Direct/NonDirect/Both?
Change in wages payable
Both - this is a reconciliation account
Which SCF format? Direct/NonDirect/Both?
Income Taxes paid
Direct
Which SCF format? Direct/NonDirect/Both?
Insurance premium payments
Direct
Which SCF format? Direct/NonDirect/Both?
Real estate taxes paid
Direct
Which SCF format? Direct/NonDirect/Both?
Change in income tax
Both - this is a reconciliation account
Which SCF format? Direct/NonDirect/Both?
Patent amortization
Both - this is a reconciliation account
Which SCF format? Direct/NonDirect/Both?
COGS
Neither
Which SCF format? Direct/NonDirect/Both?
Proceeds from sale of LT bond investment
Both
Which SCF format? Direct/NonDirect/Both?
Collections on loans to customers (principal)
Both - shown as an investment activity
Which SCF format? Direct/NonDirect/Both?
Collections on loans to customers (interest)
Direct - shown as an operating activity
Which SCF format? Direct/NonDirect/Both?
Dividends paid
Both - Financing
Which SCF format? Direct/NonDirect/Both?
Amortization of Bond Discount
Both
Which SCF format? Direct/NonDirect/Both?
Proceeds from sale of land (noninvestment)
Both
Which SCF format? Direct/NonDirect/Both?
Purchase of cash equivalent securities
Neither - not a cash flow
Loss on sale of assets
Reduces NI but not CF - must be added back to CF
Indirect Method of SCF
Decrease in A/R
Added to accrual NI
Increase in A/R is subtracted
Indirect Method of SCF
Decrease in Inventory
Added to accrual NI
Increase would be subtracted
Indirect Method of SCF
Decrease in Unearned Revenue
Subtracted from accrual NI
Increase would be added
Indirect Method of SCF
Decrease in A/P
Subtracted from accrual NI
Increase would be added
SCF add or subtract equation
Chg in Cash = Chg in Liabilites + Chg in OE - Chg in all other assets
Works for NI & Sales - Opposite signs for Expenses
Interest & Taxes paid in SCF using indirect method are reported where?
Notes or supplementary schedulre
Op/Inv/Fin Cash Flow?
Dividends paid
Financing
Op/Inv/Fin Cash Flow?
Dividends paid
Financing