EZ CASH FLOW CASH F ACCOUNTS PAYABLE JOHNSON CAPITAL 1 0 F CASH ACCTSREC EQUIP ACC DEPR EXPENSES REVENUE ACCOUNTS RECEIVABLE CLOSINC REVENUE EXPENSES ACCTSPAY J CAP REV EXP DEPR EXP 30,000 20,000 0 0 DEPR EXPENSE JCAPITAL 1,000 9,000 EPRECIATION EXPENSE EQUIPMENT Note: enter the drawing as a debit to the capital account. ACCUM. DEPR EQ. There are three types of cash flows: 1 OPERATING: cash flows from revenues and expenses. 2 INVESTINIG: cash flows from purchasing or selling assets. 3 FINANCING: cash flows from owner's investment or withdrawals. TRANSACTIONS--Using your pencil, write each debit and credit into the T-accounts above. 1 Sally Johnson invested $100,000 in her business, Sally's Consulting. 2 Sally purchased equipment for $20,000, paying cash. 3 Sally earned revenue of $30,000, one-half in cash, one-half on account. 4 Sally incurred $20,000 of expenses; she paid one-half in cash, the rest was on account. 5 Depreciation is $1,000 on the Equipment. 6 Move the net income to the Capital account. 7 Sally withdrew $3,000 from the business CASH FLOW STATEMENT Cash Flows from Operations Net Income + Depreciation Expense - Increase in Accounts Receivable + Increase in Accounts Payablel Net Cash from Operations Enter the net income here. Enter the depreciation expense. Enter A/R balance and make it negative. Enter Accounts Payable balance 0 Add Cash Flows from Investing Purchase of Equipment Enter Equipment balance, make it negative. = IF(SUM(A101_DR)> SUM(A101_CR),SUM(A101_DR)-SUM(A101_CR).""") = IF(SUM(A101_CR)> SUM(A101_DR),SUM(A101_CR)-SUM(A101_DR).""") Cash Flows from Financing Investment by Owner Withdrawal by Owner Net Cash from Financing Enter Johnson's investment Enter Johnson's drawing as a negative number. 0 Add Total Cash flows Beginning Cash Balance Ending Cash Balance 0|=F36+F39+F44 0 0|=F46+F47 This final figure must match the ending balance in the cash account EZ CASH FLOW +