Cash Flow Statement Format 2021
Cash Flow Statement Format is a essential material for the students to solve the cash flow statement questions. Cash flow statement is a weighty chapter in class 12, BBS 1st and BBA 1st semester too. It carries 10 marks in the exam when it is not asked as a case study question.
Are you looking for cash flow statement format Nepal, and then you are on the better place to download the format. Kindly go through this article to download and you can also solve your queries related to the cash flow statement format pdf by reading the explanations done on each of the steps of the formats.
Cash flow statement bbs 1st year's and cash flow statement bba 1st sem's formats are totally same. Here friends, I am going to provide you the cash flow statement format in pdf and excel file. Friends if you are searching for the cash flow statement format pdf and cash flow statement excel format then here you will find those stuffs to download easily.
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| Cash Flow Statement Format 2021 |
Cash Flow Statement Format Direct Method
Solving cash flow statement from direct method is very easy when you know the full format of the direct method. We separate the cash flow from operating activities, cash flow from investing activities and cash flow from financing activities to include the items as per the mentioned headings. The most difficult part of the cash flow statement format is cash flow from operating activities because there we have to deal with different five topics inside it with their subheadings.
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Cash Flow From Operating Activities:
This is the first heading among the three headings in the cash flow statement format. We have to deal with five topics in this heading. Again, we have to deal with different elements inside those five topics.
The cash flow from operating activities contains and looks like the following.
A. Cash collection from customers:
-Sales------------------------------------------------------------Always Add
-Increase in debtors/a/c/receivable/bills receivable-------****
-Decrease in debtors/a/c/receivable/bills receivable-----(****)
B. Cash paid to suppliers:
-Cost of goods sold [COGS]----------------------------------Always Subtract
-Increase in Inventory-----------------------------------------(****)
-Decrease in Inventory----------------------------------------****
-Increase in creditors/bills payable/a/c payable-----------****
-Decrease in creditors/bills payable/a/c payable----------(***)
C. Cash paid to employee and other operating expenses:------------All operating expenses are subtracted
-Wages
-Salaries
-Manufacturing Expenses
-Administrative expenses
-Selling expenses
-Other operating expenses
Increase in o/s expenses-------------------------------------****
Decrease in o/s expenses-------------------------------------(****)
Increase in advance/prepaid expenses----------------------(****)
Decrease advance/prepaid expenses------------------------****
D. Interest Paid [Subtract]
Note: We should have to see if there is any adjustments are given in the additional information or in the balance sheet or also in the income statement. The adjustments may be like advance and outstanding interest.
E. Tax Paid [Subtract in Normal case]
Note: We should subtract or add the adjustment given in the question related to the tax paid. Like if there is tax paid in advance we should adjust that.
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Important Note: We must know basic rule of cash going outward from the business or incoming to the business. When cash comes in we must add, when cash goes out of the business we must put it in bracket which means to subtract.
For example, when inventory increases by 10000 it means the business purchased something to offer to its customers. When the business purchases something it pays cash out. That ultimately means cash gone out of the business. That's why we must put it in brackets which mean to subtract.
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| Cash flow from operating activities |
There fore we can get the result of cash flow from operating activities before extraordinary items. If there is given extraordinary items like bank overdrafts and short term investment or marketable securities then we should have to adjust them as follows:
- If the short term investment or the marketable securities are increasing then write them in the bracket which actually means to subtract. When those things increase it means we invested more capital and the cash goes out from our entity then we have to subtract to show it is going out of our business in one year. Its exactly inverse in the case of decreasing short term investment and marketable securities.
- In case of bank overdraft, when it is increasing it means that we took extra loan from the bank which also means cash comes in to our business so we add this in cash flow statement format. Its exactly contrary in decrease in bank overdraft.
After doing all the above we can get Net cash flow from operating activities.
Let's move towards the cash flow from investing activities.
This is the cash flow statement format interpretation on its different steps to make you aware about the logics and ideas you should follow while solving the problem. You can also download cash flow statement excel format directly from The Helping Daily.
Cash Flow From Investing Activities:
We include all the activities related to the fixed assets like purchasing and selling of the fixed assets. In addition we include dividend received in this topic.
Elements like sale of investment, long term investment made, sale and purchase of fixed assets are included here.
Note: We must see if the item is taking cash away from the business or making the entry of cash in the business. When any cash enters in to the business like sale of furniture we get cash after selling the furniture then we must add that item.
When we purchase some thing or make the investment the cash goes out of our business that's why we should store that amount in brackets which means to subtract.
There fore we get Net cash flow from investing activities.
Let's move to the last part of cash flow statement format, cash flow from financing activities.
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| Cash flow from investing and financing activities |
Cash Flow From Financing Activities:
Here we consider the issue of share, share premium, loan and the debenture. We disclose all the matters related with share and debenture as well as loan in this topic. Moreover we also include dividend paid in cash flow from financial activities.
Note: As on the above we should consider if the cash is coming in to the business or going out the business to know if we should add the item or subtract.
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