Consolidated Cash Flow Statement (Indirect Cash Flow Method, Accounting Equation)

Using the indirect cash flow method to develope Consolidated Cash Flow Statement (for operating activities) and an overview of financing and investing activities, cash flow for operating activities uses the indirect cash flow method where you start with net income and subtract any noncash revenues and add back any noncash expenses, two areas to deal with are (1) operating assets and liabilities and (2) nonoperating revenues and expenses, deterime cash flows thru modifying the accounting equation where assets are broken down between cash plus other assets (cash + other assets = liabilities + shareholders equity) can use the equation to determine the change in cash flow for operating activities by looking at the change for each account (easy to understand and deterimne cash flows using the equation), the indirect cash flow method (used for operating activities) starts with net income and subtracts noncash revenues and adds back noncash expenses, example shows how to use this equation to determine whether an account amount should be added or subtracted for the particular activity to deterime the cash flows, balance sheet template with journal entries (T Accounts) showing the cash flows by operating activity is used with the formula (actual amounts), detailed example for operating activity what is included for cash inflows and outflows for net cash provided or used by operating for the Consolidated Cash Flow Statement by Allen Mursau