How to Determine a Cash Flow Statement
A cash flow statement is a key financial document that displays the general financial stability of an enterprise. The statement shows this financial stability by displaying the enterprise's ability to meet all of its short-term financial responsibilities, such as debt servicing, payroll and dividends. An enterprise may choose from a number of different types of cash flow statement models that focus on different aspects of business, but all of these utilize the same basic methods of accounting and provide the same key information in the end.
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Instructions
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Calculate cash flow from operations. Take the business's net income and add or subtract the values of depreciation, accounts payable, accounts receivable, taxes and inventory value.
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Calculate cash flow from investment activities. An example of an investment activity would be the purchase of real estate or another company's stock. Although such payments may pay off later, they have a negative effect on the business's current cash flow. Subtract this number from the cash flow from operations.
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Calculate cash flow from financing. Represent money paid to service existing debt and funds paid to investors in dividends as negative numbers; represent money received through loans or through the sale of equity in the company as positive numbers. Take the difference between cash flow from operations and cash flow from investment activities and add or subtract the total value of financing activities.
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Represent the total value of all three aspects of cash flow as a net increase or decrease of cash. Display this number prominently on the cash flow statement.
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