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Cash Flow from Operating Activities Guide

The company generated RM104,000 in profit before tax. After adjusting for non-cash expenses like depreciation and gains/losses on asset sales and changes in working capital like increases in accounts receivable and inventory, the company generated RM111,300 in cash from operations. After receiving RM5,050 in interest and paying RM3,800 in interest expenses and RM25,000 in income taxes, the company's net cash from operating activities was RM87,550.

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نور عفيفه
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33 views2 pages

Cash Flow from Operating Activities Guide

The company generated RM104,000 in profit before tax. After adjusting for non-cash expenses like depreciation and gains/losses on asset sales and changes in working capital like increases in accounts receivable and inventory, the company generated RM111,300 in cash from operations. After receiving RM5,050 in interest and paying RM3,800 in interest expenses and RM25,000 in income taxes, the company's net cash from operating activities was RM87,550.

Uploaded by

نور عفيفه
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd

CF FROM OPERATING ACTIVITIES

Indirect Methods
RM
Profit before tax 104,000

Ajustments for:
Depreciation 25,000
Gain on sale of plant -4,000
Interest Income -5,000
Interest expense 4,000
Increase in AR -9,000
Increase in inventory -5,000
Increase in prepayments -1,500
Increase in account payables 3,000
Decrease in other payables -200
Cash generated from operations 111,300

Interest received 5,050


Interest paid -3,800
Income taxes paid -25,000

Net cash from operating activities 87,550

Steps
1 Start with PBT
Adjust for non-cash items e.g. depreciations, impairments, gain/loss
2 of assets sold
3 Adjust activities (increase/decrease or inflow/outflow of CA or CL)
from financial position that affects operation e.g. AP, inventory, AP
etc)

4 Adjust for tax and interest (depends whether in investing/financing)

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