Understanding Cash Flow Statements

Cash Flow Statements thumbnail

You have The Balance Sheet and Income Statement of The Burgs Company. You need to answer a few questions and then construct The Burgs’ Cash Flow Statement (using the Direct and Indirect methods).

1. How much is the net change in The Burgs’ Retained earnings account during the current year?

 
 
 

2. How is the change in Inventory recorded in the firm’s Indirect Cash Flow Statement?

 
 
 

3. Using the Indirect approach, how much is The Burgs’ Cash flow from operations (COO)?

 
 
 

4. How much is The Burgs’ Net Cash from operating activities?

 
 
 

5. Using the Direct method, how much is the cash that The Burgs received from its customers?

 
 
 

6. Using the Direct method, how much is the cash that The Burgs paid to its suppliers?

 
 
 

7. How much is the net increase/decrease in cash and cash equivalents for the period?

 
 
 

8. Which of the following is not a major section in a typical Cash Flow Statement?

 
 
 

9. Construct The Burgs’ Cash Flow Statement (using the Indirect Method).

 

10. Construct The Burgs’ Cash Flow Statement (using the Direct Method).


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