Operating Activities

Operating Activities
Net Income $ XXX XXX XXX XXX XXX XXX XXX XXX $ XXX

Includes those activities that enter into the determination of net income

Add: Decr. in Current Noncash Assets Incr. in Current Liabilities Depreciation Exp. Losses Less: Incr. in Current Noncash Assets Decr. in Current Liabilities Gains Net Cash Flows from Operating Activities

Operating Activities

Changes in current assets and current liabilities imply changes in cash. Changes in current assets and current liabilities are treated as indicated below:
Change in Account Balance during Period Increase Decrease Subtract from Add to net income net income Add to Subtract from net income net income

Current Noncash Assets Current Liabilities

Operating Activities
Operating Activities
Net Income Add: Decr. in Current Noncash Assets Incr. in Current Liabilities Depreciation Exp. Losses Less: Incr. in Current Noncash Assets Decr. in Current Change in Account Balance during Period Liabilities Increase Decrease Gains
Subtract from net income Add to net income Add to net Cash income Net Flows from Subtract from Operating Activities net income

$ XXX XXX XXX XXX XXX XXX XXX XXX $ XXX

Current Noncash Assets Current Liabilities

Operating Activities
Operating Activities
Net Income
Change in Account Balance during Period Noncash Assets Increase Decrease Subtract from Add to Incr. in Current Liabilities net income net income Add to Subtract from Depreciation Exp. net income net income

$ XXX XXX XXX XXX XXX XXX XXX XXX $ XXX

Add: Decr. in Current

Current Noncash Assets Current Liabilities

Losses

Less: Incr. in Current Noncash Assets Decr. in Current Liabilities Gains Net Cash Flows from Operating Activities

Operating Activities
Operating Activities
Net Income $ XXX XXX XXX XXX XXX XXX XXX XXX $ XXX

Depreciation and Amortization Expense are added back to net income because they are non-cash expenses.

Add: Decr. in Current Noncash Assets Incr. in Current Liabilities Depreciation Exp. Losses Less: Incr. in Current Noncash Assets Decr. in Current Liabilities Gains Net Cash Flows from Operating Activities

Operating Activities
Operating Activities
Net Income Add: Decr. in Current Noncash Assets Incr. in Current Liabilities Depreciation Exp. Losses Less: Incr. in Current Noncash Assets Decr. in Current Liabilities Gains Net Cash Flows from Operating Activities $ XXX XXX XXX XXX XXX XXX XXX XXX $ XXX

Losses are added back to net income. Gains are subtracted from net income.

Investing Activities
Investing Activities

Includes transactions that involve the acquisition or disposal of noncurrent assets

Add: Proceeds from sale of land, buildings, equipment, or other noncurrent assets Receipt of principal from investments Less: Payments to acquire land, buildings, equipment or other noncurrent assets Payments to acquire investments Net Cash Flows from Investing Activities

$ XXX XXX

XXX XXX $ XXX

Financing Activities
Financing Activities
Add: Proceeds from borrowings Proceeds from issuing capital stock Proceeds from sale of bonds Less: Principal payments on borrowed funds Payments related to bond maturities Dividend payments Net Cash Flows from Financing Activities $ XXX

Includes transactions involving receipts from or payments to creditors and owners

XXX XXX

XXX XXX XXX $ XXX

Noncash Investing and Financing Transactions

Example:

Direct exchange transactions occur when noncurrent balance sheet items are swapped. Such exchanges must be disclosed.

Bobo, Inc. acquires a building in exchange for 2,000 shares of common stock. This is reported in a separate supplemental schedule attached to the statement of cash flows.