The 3 Statements Overview

Question 1

Statement of Cash Flows

Answer 1

Has 3 sections:
Cash flow from Operating Activities
Cash flow from investing Activities
Cash flow from financing Activities

Cash flow from Operating Activities:
- revenue producing aspects of the firm, like sales, purchases etc.
- We have to add back D&A and Changes in Working Capital (current assets - current liabilities) That is because these are non-cash transactions

Cash flow from investing Activities:
Cash flow from buying and selling PP&E and other non-current assets. PP&E expenses are known as CapEx

Cash flow from financing:
Changes in capital structure, e.g. issuing debt or equity (cash inflow),
repaying loans, bonds and dividends, issuing and buying back shares

Finally, this all gives us the net cash increase/decrease which is then added to the opening cash balance (found in previous years balance sheet or previous years SoCF)