Cashflow Statements - Three examples
Alpha Corporation
I) For each of the years on the Statement of Cash Flows:
Year 1989
1. Major sources of cash = Long-‐term debt and short-‐term debt. Major use of cash = Investment in depreciable assets. 2. Cash flow from operation was greater than net income as the firm was reporting a net loss of $320.6 million. The major reason was a big chunk of allocation from depreciation and amortization as well as an allocation of $125.3 million for restructuring. 3. The firm was not generating enough cash from operations to pay for all of its capital expenditure. 4. The firm was not able to cover the capital expenditures but still paying out dividends amounting to @$26 million. 5. –Not applicable-‐ 6. Short-‐term debt and long-‐term debts are the sources of cash the firm used to pay for capital expenditures and dividends 7. The working capital accounts other than cash and cash equivalent were primarily users of cash. 8. No other major items affected cash flow for the year.
Year 1990
1. Major sources of cash = Proceeds from disposal of depreciable and other assets, proceeds from sale of discontinued operations. Major uses of
I) For each of the years on the Statement of Cash Flows:
Year 1989
1. Major sources of cash = Long-‐term debt and short-‐term debt. Major use of cash = Investment in depreciable assets. 2. Cash flow from operation was greater than net income as the firm was reporting a net loss of $320.6 million. The major reason was a big chunk of allocation from depreciation and amortization as well as an allocation of $125.3 million for restructuring. 3. The firm was not generating enough cash from operations to pay for all of its capital expenditure. 4. The firm was not able to cover the capital expenditures but still paying out dividends amounting to @$26 million. 5. –Not applicable-‐ 6. Short-‐term debt and long-‐term debts are the sources of cash the firm used to pay for capital expenditures and dividends 7. The working capital accounts other than cash and cash equivalent were primarily users of cash. 8. No other major items affected cash flow for the year.
Year 1990
1. Major sources of cash = Proceeds from disposal of depreciable and other assets, proceeds from sale of discontinued operations. Major uses of