Cash Flow Statement - Indirect Method (Full Example)

In this lesson, we go through a thorough example of the Indirect Method of the Cash Flow Statement. you will also get to learn the full format of the indirect method. We go through the three sections of the cash flow statement:
1) Cash flows from operating activities
2) Cash flows from investing activities
3) Cash flows from financing activities
Cash Flow Statement | Direct Method | Full Example: • Cash Flow Statement | ...
Dividends Treament in the Cash Flow Statement: • Dividends | Treatment ...
The Financial Statements & their Relationship / Connection | Explained with Examples: • The Financial Statemen...
Straight Line Method & Diminishing Balance Method of Depreciation: • Straight Line Method v...
Prepaid Expense Explained With Journal Entry and Adjusting Entry example: • Prepaid Expense Explai...
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[@nomakhwezisithole3611]

if all students could listen to this, they would pass accounting with an A.Don't you have a video explaining tangible and intangible assets?

[@Counttuts]

Thank you for the kind feedback Nomakhwezi. Will work on that one.

[@pearllenyanyabidi6905]

@@Counttuts hi sir, what should I do if I'm.not given the profit before tax amount and I'm also not given the income statement

[@3p1cRs]

@@pearllenyanyabidi6905 You can also compute net income by using other accounts such as retained earning and dividends, For example if a company had Beginning RE of 20k, ending RE of 35k and Dividends declared of 10k, you can compute Ending RE - Beg RE + Dividends declared to come up with 25k net income

[@spreadpositivityandlove.9849]

​@@3p1cRs thanks 🙏.. great Work

[@Mlee.]

You are the best teacher! The lesson was comprehensive and I most definitely benefited.

[@aravindvasudev7921]

Thanks for explaining it so nicely. After listening to your lecture, I am confident that I will be able to generate cashflow statement in exam. The format that you use makes things very easy and understandable.

[@gaolatlheopemolwantoa4940]

THANK YOU SO VERY MUCH FOR SUCH CONTENT. BELIEVE YOU ME, YOU ARE CHANGING LIVES! MAY GOD BLESS YOU AND KEEP YOU. THANK YOU ONCE MORE.

[@shubhammadan223]

This was the only detailed video others are just doing it not giving and explanation helped a lot

[@ziphomadolwana8736]

Big up for representing South Africa with this good work brother. Your videos are amazing

[@renonaidoo3315]

I'm so grateful that i discovered you ...you made me enjoy accounting. I have learnt a great deal from you.

[@enochbasimolodi9225]

Thank you sir for clarifying this for me. I have been struggling with this for quite sometime now. You have really made life easy for me. I had resorted to preparing accounts without this statement but now it is a requirement I cannot avoid. I am set now!

[@olivernyathi4805]

Easy to understand, explanations were clear. Thank you so much Sir, this video helped me a lot.

[@benjaminharris8354]

you're a whole legend dude!!! you've helped me so much with this assignment

[@kapsy7382]

your videos are so helpful. helped me pass my mid-semester exams. thank you

[@Mamo_Kitty]

Very informative. I was struggling but this video really helped alot

[@nomsamachilika1689]

Really helpful.
Easy to understand and explanations were 100%.
Thank you :)

[@Counttuts]

Glad it helped. Thank you Nomsa.

[@simransingh4031]

Extremely helpful!! Thank you so much

[@alihj4189]

excellent video with very clear explanation , thank you very much !!

[@JuanitaNahiTukumeTagua]

THANK YOOU SO MUCH, YOU SAVED MY ACCOUNTING DEGREE

[@emanhumayoun9538]

Thank u so much sir! This video really assisted me in grabbing the whole concept clearly

[@alegiancemahole6204]

Thank you soo much I really gained much from this ...Please keep up the good work sir

[@TheWweliverpool]

thank you so much sir for the explanations really appreciated

[@saltlifo5598]

Thank you so much, you have helped me I'm a second year student at Solusi

[@tinotendagarwe4929]

very useful my guy. benefited greatly

[@berthasheya5481]

I am going to write my exam today and this video really helps me out so well. God bless you sir

[@garaesamuel7145]

Thank you, I have learn a lot from this video. So thankful

[@huyvu4945]

i want to ask that why the increase of accumulated depreciation in the balance sheet is not counted as depreciation expense to note into the operating activities

[@veronicastzulu8184]

Thank u very much for the good explanation

[@tibuCooks]

What do you do if the adjustment says, all inventory was purchased in cash?

[@kganyagomaekela1090]

Thanks very much... feel ready for the test

[@shamshoum490]

A very useful explanation
Thanks

[@sisandaxaba8991]

Life saver! 🙏

[@jonathanferis4705]

Hi, thanks for the videos. I dont think student wil fail after watching these videos. I have gone through all but can seem to find any cash flow forecast videos. If you do have 1 please share.

[@catherinenalubegs5370]

Thank you so much ,this has been really helpful

[@DIMPHORAMOSWAANA]

this was veryyyy heplful, thank you

[@cherihewlett]

hi - how is the change in retained earnings calculated? 2018=32,200 vs. 23,200 in 2017 and your change is calculated as 3,000

[@sellotekane7711]

this is good.. is it possible to have access to the spreadsheet used on this video?

[@aukeilia_ramos]

Thank you so much🥺❤

[@napillakoroka7917]

youre the best bro, cheers

[@dineshashara9391]

Was good very well explained

[@Counttuts]

Thank you Dinesh.

[@lindiweveronicanjari9451]

Thank you so much sir. But i do have a question though,there by cash and cash equivalents,if they say cash on hand and at bank,what should i write? Do i write the money just like that or is there a method i should use to get the cash just from the bank?

[@DorcasNakapizye]

Eish thank you so much sir🙏🏾this has helped a lot

[@mandymurendi2227]

hey, what do i do if im given loss on sale in listed investments and also loss on sale of non-current vehicle, are they all included in operating activity or what?

[@chanemans5199]

Good day
I would just like to find some clarification as to why the prepaid expenses were taken into consideration with the direct method but not here with the indirect method as it stays a non cash item just like depreciation?
Thanks in advance

[@tshilidzitshikhudo4942]

Thanks so much for this video. It has helped me a Lord. How do we calculate profit before Taxation if only income tax expense was given?

[@pearllenyanyabidi6905]

What should I do if the profit before tax is not given and I do not have the comprehensive income statement?

[@chopchristemmanuel1421]

awesome lessons, thanks

[@sihleboskati3941]

What if the net change in cash &cash equivalents of end of year is bigger than beg of the year?

[@jabumanaka2000]

Hi Counttuts what should I do if I have been if they have give me 2 column for both years for eg. 2017 amounts and 2018 amounts in my income statement

[@bakirballou293]

Thank you so much. You really helped me out. ❤❤

[@annapoolfd187]

Amazing video!

[@lolmoe]

Ugh, I don't know what to do with mortgages. How do you do it? Do you record it in financing activities or no?😩

[@Lillyricz-0.0]

What if they say something was paid by cheque. What happens then?

[@sardarkhan8383]

Thank you Gentleman

[@evelynd]

Hi Sir, do you have a template I can use for the cash flow statement? Thanks

[@deecolramusi2630]

You are Star Sir🙏

[@quynhphuongpham8452]

How can we calculate profit before tax without infor from income statement?

[@JK-dz4ez]

Thank you so much

[@mukobelafreeshare6520]

Great Job

[@reratiloemazuru3685]

i saw an example in one text book
dividends were put in the financing activities
and here they are in the operating activities
can you explain that to me

[@Counttuts]

Please see the explanation here: ua-cam.com/video/Qb-eEGZGOxU/v-deo.html

[@nondumisomlondo5709]

Thank you Sir

[@kharenbathan6557]

thank you so much for this!

[@tadie1109]

Hey, thank you so much for your video. i have a question, why did we not include amortization when adjusting for non cash items and also why did we not put the dividends paid under financing activities. Thank you in advance

[@Counttuts]

Check out our explanation here: ua-cam.com/video/Qb-eEGZGOxU/v-deo.html

[@tadie1109]

Thank you so much

[@selinaramotsoela9308]

how do u set excel to calculate total amount

[@afrinaafiqah4043]

thank you!!!!

[@mariewilliams1906]

Loss of sale of equipment, 2000, why isn't it zero. It was included in the 95,000 Profit before taxes on the income statement? I feel like it was done twice.

[@thevineyard7149]

Great👏👏👏👏 next share marginal costing.

[@efoliekot2002]

Brillant

[@HumairAnwer-SEBSEFF]

GOOD JOB

[@Kakiharaichii]

You had a loss on the sale of equipment, you need to deduct that from the the proceeds. Thats wrong info. Also dividends paid is not part of operating cash flow it is belong to financing.

[@Counttuts]

You are actually wrong, loss on disposal was deducted as an expense on the income statement, so we need to add it back since it is a non-cash item. If it were a profit on disposal, we would have deducted it because it is equally a non-cash item.
With regard to dividends, check out our explanation here: ua-cam.com/video/Qb-eEGZGOxU/v-deo.html

[@rojaycampbell6209]

Also isn't dividend paid a financing activity

[@rojaycampbell6209]

Watched the video and I saw amortization of prepaid expense

[@rojaycampbell6209]

This video is wrong wrong😐😐😐. Howwwwww for the operating activities majority of it are negative 60,38,48 but yet it ends up at only 8 for the net. That doesn't make sense.. dividend paid is financing activities so the 48 shouldn't be ther. Nb I'm taking in 1000s

[@Counttuts]

It is 100% correct, you may not have understood the lesson. As for dividends paid, it is correct. See the explanation here ua-cam.com/video/Qb-eEGZGOxU/v-deo.html

[@nokwandambuli3010]

You simply the best wow and your videos are short which keep students longing for more.And the way you explain it’s simple and easy to follow.Thank you

[@samkab677]

Why did you start with 95000 instead of 57000?

[@colinakinnawo7873]

I guess you can start with 57,000, but 38,000 tax paid will no longer be a deduction in "Changes in Working Capital" as it has already been deducted in arriving at the 57,000 net profit.

[@namugerwapatiencediana5075]

I think it's very good but the work is not visible at all

[@boitumelobonginkosikunene3547]

whether it's MANFIN or FINACC - Counttuts never disappoints. THANK YOU.