Cash flow
Cash Flow
OMM 622: Financial Decision-Making
Instructor: Felix Lao
September 30, 2013
The first thing any accountant looks for with a company financial is the bottom line. It is operating in the positive or negative and how much work will need to be done if it is not positive. Cash flow reflects how much cash is generated from the products and services sold by a company. Cash flow calculations involve making adjustments to net income by adding and subtracting the differences in revenue, expenses and credits which happen when transaction take place from one period to the next. Not all transaction involves cash items so some calculations have to be done when calculating cash flow from an operations standpoint. Because there are changes with account receivable from one period to the other it has to reflect on the cash flow statement because it affects the cash flow statement.
When viewing the Eastman Kodak income statement there are many important factors a financial analyst would look for within a company’s cash flow statement. According to the financial report
“The Company’s primary sources and uses of cash for the year ended December 31, 2007 included proceeds on the sale of businesses/assets, loss from continuing operations adjusted for non-cash items of income and expense, debt payments, restructuring payments, capital additions, working capital sources and needs, dividend payments and employee and retiree benefit plan payments/contributions. Net cash provided by continuing operations from operating activities was $351 million for the year ended December 31, 2007. The Company’s primary sources of cash from operating activities for the period are earnings from continuing operations, as adjusted for non-cash items of income and expense, which provided $652 million of operating cash. Included in cash flow from operating activities is approximately $306 million that relates to current and prior-year non-recurring licensing
OMM 622: Financial Decision-Making
Instructor: Felix Lao
September 30, 2013
The first thing any accountant looks for with a company financial is the bottom line. It is operating in the positive or negative and how much work will need to be done if it is not positive. Cash flow reflects how much cash is generated from the products and services sold by a company. Cash flow calculations involve making adjustments to net income by adding and subtracting the differences in revenue, expenses and credits which happen when transaction take place from one period to the next. Not all transaction involves cash items so some calculations have to be done when calculating cash flow from an operations standpoint. Because there are changes with account receivable from one period to the other it has to reflect on the cash flow statement because it affects the cash flow statement.
When viewing the Eastman Kodak income statement there are many important factors a financial analyst would look for within a company’s cash flow statement. According to the financial report
“The Company’s primary sources and uses of cash for the year ended December 31, 2007 included proceeds on the sale of businesses/assets, loss from continuing operations adjusted for non-cash items of income and expense, debt payments, restructuring payments, capital additions, working capital sources and needs, dividend payments and employee and retiree benefit plan payments/contributions. Net cash provided by continuing operations from operating activities was $351 million for the year ended December 31, 2007. The Company’s primary sources of cash from operating activities for the period are earnings from continuing operations, as adjusted for non-cash items of income and expense, which provided $652 million of operating cash. Included in cash flow from operating activities is approximately $306 million that relates to current and prior-year non-recurring licensing