Professional Documents
Culture Documents
Cash Flowss
Cash Flowss
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Cash flow statement:
Wal-Mart example
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III. Procedures for Preparation of the
Statement of Cash Flows
1. Operating Cash Flows (indirect
method).
2. Investing Cash Flows.
3. Financing Cash Flows.
1. Direct exchange.
2. Partial cash investing and
financing activities.
3. Cash dividends declared.
Cash burn rate is a popular metric for assessing how quickly a start-
up firm will consume its cash reserves:
Cash used for Cash used for capital
operations + expenditures or acquisitions
Cash burn rate =
# of months covered by cash flow statement
Cash burn rate: Amazon.com illustration
Months to burnout:
+Inc. in Inventory;
Cost of or Payments
Goods -Dec. in Inventory = to
Sold +Dec. in A/P; or Suppliers Cash
-Inc. in A/P Outflows
from
Salary +Dec. in Sal. Payable; Payments Operating
or = to Activities
Expense -Inc. in Sal. Payable Employees
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