Cash Flow Statement
• Meaning – Where did the cash come from- where did the cash
go to
• As comparing financial statement changes from 1 year to the
next, you need 2 years of financial statements to prepare
• Remember the DUCS
o Debit=use
o Credit = source
• Your answer is the change in cash
Cash Flow Statement is also known as the Sources and Uses
Statement
Asset Increase
Liability Decrease
Net Worth Decrease
Asset Decrease
Liability Increase
Net Worth Increase
Debit
Debit
Debit
Credit
Credit
Credit
Use
Use
Use
Source
Source
Source
When preparing the statement--- debits are bracketed and sources
are unbracketed.
Hint: use terms of bracketed and unbracketed instead of positive
or negative
Free Cash Flows
Definition of Free Cash flow is the cash available to investors
after investment in assets to sustain growth