Learning Materials For Accounting, Management , Finance And Economics.

Thursday, April 22, 2010

Concept Of Cash Flow From Financing Activities And Its Determination

Financing activities are concerned with cash collection by issuing shares and debentures, raising long-term loan and so on. It also involves cash outflows in terms of redemption of debentures and preference shares, repurchase of shares, repayment of long-term loan and payment of cash dividend.The specimen showing the determination of cash flow from financing activities are as follows.






Particulars...............................................................Amount

Issue of equity shares............................................................xxx
Increase in share premium...................................................xxx
Issue of preference share.......................................................xxx
Issue of debentures.................................................................xxx
Long-term loan obtained........................................................xxx
Repurchase of shares..............................................................(xxx)
Redemption of preference share...........................................(xxx)
Redemption of debentures.....................................................(xxx)
Repayment of long-term loan................................................(xxx)
Payment of cash dividend........................................................(xxx)

Cash from financing activities......................................(xxx)