Wiley GAAP: Financial Statement Disclosure Manual. Joanne M. Flood

Cash flows from financing activities: Dividend payments (xxx) Payment of contingent consideration (xxx) Sale of common stock Xxx Repayment of long‐term debt (xx) Reduction of notes payable (xx) Proceeds from debt Xxx Payment of debt issue costs (xx) Principal payments under lease obligations (xxx) Net cash provided by financing activities xx Effect of exchange rate changes on cash, cash equivalents, and restricted cash xx Cash, cash equivalents, and restricted cash Net increase (decrease) in cash, cash equivalents, and restricted cash and restricted cash equivalents xxx Cash, cash equivalents, and restricted cash at beginning of year xxx Cash, cash equivalents, and restricted cash at end of year $ xxx Supplemental disclosure of cash flow information Cash paid for interest, net of amounts capitalized ($xxx) Cash paid for income taxes, net of refunds ($xxx) Schedule of noncash financing and investing activities: Conversion of bonds into common stock $ xxx Right‐to‐use property acquired in exchange for a lease liability $ xxx Dividends declared, not paid $ xxx

Operating Activities Presentation The operating activities section of the statement of cash flows can be presented under the direct method or the indirect method.

       Exhibit—Converting Income Statement Amounts from the Accrual Basis to the Cash Basis—Direct Method

Accrual Basis		Additions		Deductions		Cash Basis
Net sales	+	Beginning A/R	–	Ending A/R	=	Cash received from customers
Cost of goods sold	+	Ending inventory Beginning A/P	–	Manufacturing depreciation and amortization Beginning inventory Ending A/P	=	Cash paid to suppliers
Operating expenses	+	Ending prepaid expenses Beginning accrued expenses	–	Sales and administrative depreciation and amortization Beginning prepaid expenses Ending accrued expenses payable Bad debts expense	=	Cash paid for operating expenses

Example 6.2: Operating Activities: Formats for Direct and Indirect Methods

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Direct Method
Cash flows from operating activities:
Cash received from sale of goods	$xxx
Cash interest received	xxx
Cash dividends received	xxx
Cash provided by operating activities		$xxx
Cash paid to suppliers	(xxx)
Cash paid for operating expenses	(xxx)
Cash interest paid	(xxx)
Cash paid for taxes	(xxx)
Cash disbursed for operating activities		(xxx)
Net cash flows from operating activities		$xxx
Indirect Method