Joyner Company, first
Cash Flow Statement
In Year 2,
Particulars Calculation of Amount ($)
operating activity cash flows:
$56,000 in profit
The following should be added: Depreciation expenditure $42,000 $132,000 - $120,000 + $30,000
Less: 8,000 in gain from the selling of equipment
Less: An increase of 80,000 in accounts receivable
Less: A 50,000 increase in inventories
Reduced prepaid expense by 7,000
Increase: 60,000 in accounts payable
10,000 less: 10,000 less in incurred liabilities
Increased income tax liability of $3,000
Operating activities' net cash flow (A) of 20,000
Investing-related cash flows:
Money used to purchase real estate, machinery, and equipment (150,000) $400,000 - $510,000 - $40,000
Addition: $18,000 in cash from the sale of equipment
Less: Hymans Company received a loan of $40,000.
Net cash utilized for investing purposes (B) (172,000)
Flows of money used for financing activities
money used to pay dividends (15,000) $124,000 - $83,000 - $56,000
Add: 30,000 in cash from the issuance of stock
Add: 120,000 in cash gained from the sale of bonds
Net financing operations provided cash (C) 135 000
Cash and cash equivalents decreased net (D = A + B + C) (17,000)
Addition: Cash and cash equivalents at the start of the period were 21,000
End-of-period cash and cash equivalents: 4,000
2.Free cash flow is calculated as net operating cash minus capital expenditures minus dividends.
$20k in free cash flow
$20,000 minus $150,000 minus $15,000 is free cash flow.
(145,000 dollars) Free cash flow
How Does Cash Flow Work?
The net amount of cash and cash equivalents coming into and going out of a business is referred to as cash flow. Money spent symbolizes outflows, whereas money received represents inflows.
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