Chapter 21 Statement of Cash Flows Revisited

TeacherWe’ve now arrived at the final chapter!  Chapter 21 deals with the Statement of Cash Flows.  The reason that it’s titled as revisited is that you were introduced to the Statement of Cash Flows in Intermediate Accounting I.

The Statement of Cash Flows contains three main sections:  Cash Flow from Operating Activities, Cash Flow from Investing Activities, and Cash Flow from Financing Activities.  Cash Flow from Operating Activities can be prepared using either the Direct or the Indirect method.  The focus here will be on the indirect method.

In your reading, you should include Appendix 21B which details the use of T-Accounts in the preparation of the Statement of Cash Flows. 

The discussion in Chapter 21 is broken down into two parts.  Part 1 deals with the basics of the Statement of Cash Flows utilizing the indirect method.  Part 2 focuses on the mechanics of using the T-Account Approach in analyzing the accounts which leads to the information presented in the Statement of Cash Flows using the indirect approach.

Part 1:  The Basics (20:48 minutes);  PDF Handout
Part 2:  The Mechanics of the T-Account Approach (19:58 minutes); PDF Handout

Assigned Exercises:
Exercise 21-1 (1:45 minutes); PDF Handout
Exercise 21-3 (2:20 minutes); PDF Handout
Exercise 21-14 (4:39 minutes); PDF Handout
Exercise 21-17 (2:07 minutes); PDF Handout
Exercise 21-22 (1:35 minutes); PDF Handout
Exercise 21-24 (2:46 minutes); PDF Handout
Exercise 21-31 (16:44 minutes); PDF Handout

Assigned Problems (The T-Account Solutions to the Problems are presented below):
Problem 21-16
Problem 21-17
Problem 21-18