WHAT ARE THE STEPS TO PREPARE A CASH FLOW STATEMENT?

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  • Don G
    Lv 7
    8 months ago

    Start with Net Income, add non cash expense as Depreciation and Amortization, then add all decreases in Assets, deduct all increases in Assets (but excluding Cash accounts), deduct all decreases in Liabilities, add all increases in Liabilities, do the same for Equity except ignore change in Retained Earnings due to Net Income.

    Proof - The net change in all of above accounts should equal the net change in Cash. 

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  • 8 months ago

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