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Cash Flow from Operations (Statement of Cash Flows) financial cash flow

by SDghjggvnlijkjh



This video demonstrates how to calculate Cash Flow from Operations (aka Operating Cash Flow) using the Indirect Method on the Statement of Cash Flows. The video uses a comprehensive example to show how Cash Flow from Operations is computed and explains how Cash Flow from Operations is different from Cash Flow from Investing and Cash Flow from Financing.

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36 comments

infjuicy 24/09/2021 - 11:01 Chiều

i love how school vids will forever hold up, even 6 years later

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Darkdracox 24/09/2021 - 11:01 Chiều

Why isn’t “cash” under current assets not added or subtracted to the Net Income?

It’s also a current asset though.

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Lady Chelsea 24/09/2021 - 11:01 Chiều

These videos have been greatly helpful this semester. My Accounting textbook hardly explains how these equations work out, so seeing examples of these problems has been super beneficial. Thank you so much.

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Beau Payne 24/09/2021 - 11:01 Chiều

never thought dale doback would be the reason i graduate college.

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abir ahmed 24/09/2021 - 11:02 Chiều

Love your videos man! One question, if the 950 dollars cash did get injected, why did we not add the whole 950 instead of just 50?

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Pieter Swiegers 24/09/2021 - 11:02 Chiều

@Edspira if we have a loss on the sale of Equipment we add it back to Net Income, would that mean that if we have a Profit from the sale of Equipment that we would deduct it from Net Income ?

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pubg mobile 24/09/2021 - 11:02 Chiều

people who disliked the video ,,,,,, wtf is wrong with you guys.
thank you for these videos absolutely a life saver.

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Devin Rockwood 24/09/2021 - 11:02 Chiều

Very great explanation. Thank you

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Akbarjon Abbosov 24/09/2021 - 11:02 Chiều

so clear,
so nice,

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Hadi Jarrah 24/09/2021 - 11:02 Chiều

Isn’t the increase in accounts payable a cash outflow ? So it has to be negative?

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JOSE GONZALEZ 24/09/2021 - 11:02 Chiều

Great class, very well explained. Thanks a lot and keep it up

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012wtf EZ 24/09/2021 - 11:02 Chiều

Thanks for the vid.

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S.A. T Dot 24/09/2021 - 11:02 Chiều

Really appreciate the video, might be too detailed a question, but: I know from your prior videos on the balance sheet, accounts receivables closes with a debit balance (increases with a debit), so I was wondering why on the actual SEC filings on the cash flow stmt that IncreaseDecreaseInAccountsReceivable closes with a credit balance, and then we have to play around with the signs to get where we want to be for the cash flow from operations? I'm assuming there's a good reason for it, will continue to look for it.

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P Dong 24/09/2021 - 11:02 Chiều

You explained so much better than the textbook.

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Ty Parker 24/09/2021 - 11:02 Chiều

You're quite an honorable man. Thank you for this video.

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Isaac Alston 24/09/2021 - 11:02 Chiều

Thank You . Your video is awesome ! Great resource. I also found some great articles on cash flow, Here https://CashFlowIdeals.com

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Patrick Doherty 24/09/2021 - 11:02 Chiều

If there was a way to donate I would

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B H 24/09/2021 - 11:02 Chiều

BEST accounting channel out here.

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Nicholas Tan 24/09/2021 - 11:02 Chiều

shouldnt you use the later year to minus the earlier year for the differences?

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Husain Ismaeel 24/09/2021 - 11:02 Chiều

That was helpful. Thanks a lot!

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pbr 24/09/2021 - 11:02 Chiều

don't take this the wrong way but i love you, thank you for these videos.

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Devo OS 24/09/2021 - 11:02 Chiều

On Accounts Payable I'm still a little confused about. Are we adding back the the $30 because that's money coming inn as oppose to money that we owe that's going out? and that's why it's not a negative?

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Stan Tan 24/09/2021 - 11:02 Chiều

How does accounts payable and receivable affect our cash flow statement? I thought they won't be added back into our cash flow because we haven't realised the cash yet from either money coming in from receivables or money going out from payables.

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Crystal Andrassy 24/09/2021 - 11:02 Chiều

I am having trouble understanding why the increase in A/P would be added to cash instead of subtracted. If the company owes $30 more, shouldn't that be subtracted from the cash? Or is it because the company has the $30 currently because it hasn't been paid yet? Thanks

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Nando Jimenez 24/09/2021 - 11:02 Chiều

Very great video!!! I would have deffinitely added the "hand" rule to describe the increase/decrease of the different accounts on the Cash Flow. Hand Rule: So if cash is getting on your hand (receving/getting/putting on hand) then add that to cash (+ on CF), if cash is going away from your hands (leaving/going away/no longer putting in hand) then subtract that to cash (- CF). So for any Assets, think about if you increase an asset (lets say an iPhone aka inventory), then that means you must have PURCHASED that iPhone, so then to get an iPhone cash will LEAVE your hand. Meaning increase in Asset = reduce / subtract cash. That's why increase in Inventory or Accounts Receivable will be subtracted from Cash Flows (opposite will happen if you decrease assets. So what's important here is wether the account is increasing or decreasing). For any liability, if you owe money to someone that means you borrowed cash from them so that cash is getting on your hand. That's why increase of Liabilities (like A/P) will be an increase in Cash (cuz u borrowed the money aka your hand got cash), and if you don't owe them anymore then that's a decrease in Liabilities, which will decrease your cash in hand (cuz u payed them back and the cash left your hand).

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MozPassion 89 24/09/2021 - 11:02 Chiều

Hi there, how do we deal with provisions in the PL? Some companies put provisions on PL

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Kasper 24/09/2021 - 11:02 Chiều

If it says something like accrual on gas and electricity would you put that in the operating activities?

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MozPassion 89 24/09/2021 - 11:02 Chiều

What if you have provisions? How do you do? Add to net income?

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David 24/09/2021 - 11:02 Chiều

Got a final in a few hours, great explanation!

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M 24/09/2021 - 11:02 Chiều

Thank you so much for making these videos. When I feel stressed out about my accounting homework I just watch some of these. It makes me feel SO much better. The information provided is informative, practical and accurate. This is such a huge help for my study.

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thethingis99 24/09/2021 - 11:02 Chiều

Very helpful. Thanks!

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X F 24/09/2021 - 11:02 Chiều

Thank you so much for your excellent video! I have a quick question about inventory. If we think an increase in inventory comes from cash we used to purchase the inventory, so an increase of inventory is considered as a cash used by the entity, how should we think about an decrease in inventory? My understanding is that when there is an decrease of inventory, it is considered cost of goods sold, and cost of goods sold was subtracted from revenue when calculating net income. But cost of goods sold is not real cash flow out, so cost of goods sold should be added back in arriving at cash basis of net income. Is my understanding correct? cash from for inventory increase or decrease makes me confused for a long time. Your explanation makes me feel comfortable. thank you !

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The Pencil Case 24/09/2021 - 11:02 Chiều

man im half way watching, and pause to say i love u haha, u r awesome

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MozPassion 89 24/09/2021 - 11:02 Chiều

Can we say we add back the 50 because is not from operation?

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Bharat Chaurasiya 24/09/2021 - 11:02 Chiều

Step buy step buy watching video you are best sir nice keep learning knowledge I am from is Mumbai

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Nappy God Lotanna 24/09/2021 - 11:02 Chiều

THANK YOU VERY MUCH FOR KEEPING IT SIMPLE AND STRAIGHT FORWARD

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