Intro to Cash Flow Statements | Direct Method
💥Direct Method Cash Flow Statement Cheat Sheet → accountingstuff.com/shop
🖊Cash Flow Statement Practice Questions → accountingstuff.com/practice-...
Learn all about the Cash Flow Statement and how to prepare it using the Direct Method.
▪ Cash Flow Accounting with the Direct Method (Part 2) → • Prepare A Cash Flow St...
▪ Cash Flow Accounting with the Indirect Method (Part 3) → • Prepare A Cash Flow St...
Many people have a hard time getting to grips with the Statement of Cash Flows, but in this episode of Accounting Basics for Beginners we break it down into nice and tasty, brain digestible chunks.
You'll learn why CASH IS KING, and why the Direct Method is preferred by Investors. We break down the Cash Flow Statement into it's three sections:
→ Cash Flows from Operating Activities
→ Cash Flows from Investing Activities
→ Cash Flows from Financing Activities
Last but not least... I'll explain why despite all the advantages of the Direct Method. Most corporations opt for the Indirect Method instead.
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⏱️TIMESTAMPS
00:00 - Intro
00:51 - Cash is King
01:23 - Difference between Cash and Profit
01:53 - Difference between Cash and Cash Flows
02:07 - Accrual Basis Doesn't Measure Cash Flows
02:34 - The Biggest Reason Start-Ups Fail
03:06 - What is a Cash Flow Statement?
03:53 - How does the Cash Flow Statement Work?
04:56 - Cash Flow from Financing Activities
05:30 - Cash Flow from Investing Activities
06:46 - Cash Flow from Operating Activities
07:35 - What is the Direct Method?
07:58 - How the Direct Method Works
10:21 - Advantages of the Direct Method
10:38 - Disadvantages of the Direct Method
🔎FAQ
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DISCLAIMER
Some of the links above are affiliate links, where I earn a small commission if you click on the link and purchase an item. You are not obligated to do so, but it does help fund these videos in hopes of bringing value to you!
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Пікірлер: 551
One day late... sorry guys! This one was a beast to edit. In the next video, I'll cover how to work out Cash Flow from Operations from the Income Statement & Balance Sheet using the examples discussed in this one. Stay tuned :)
@AccountingStuff
5 жыл бұрын
@Maximity Sure thing... I've been meaning to do that for a while now
@ikekeonwu
5 жыл бұрын
Thanks, James. Please what's the name of the song that starts around 0:07?
@AccountingStuff
5 жыл бұрын
@@ikekeonwu Hey mate, sorry I can't actually remember. It was from the KZread Free Music Audio Library and they didn't require a credit so I never wrote down the name
@harryvincent2209
5 жыл бұрын
Thank u sir .
@valentinmoldovan341
4 жыл бұрын
Also...congrats on your hard work! I know it's hard to make something so complex sound so easy, and to use a common language that everybody can understand! All the best and congratulations for making these "glorious mistakes" as Neil Gaiman called them: to move to a different country (without a job at that time) and to start something new, unfamiliar, but with great potential. It's also my story! :) Hugs from Berlin :)
Dude, It's like i am watching a movie where the hero is a Charming Accounting wizard :3
@camilafialla2883
2 жыл бұрын
I wish my teachers was like him😅
@lilly-annbennett7314
2 жыл бұрын
@@camilafialla2883 ikr
This is worthy of a Netflix series. (Love your vibe and the editing as well.) Thank you so much for these videos. It has been an incredible help.
@AccountingStuff
5 жыл бұрын
Hey Thawzin, that's kind of you to say! Thanks and all the best!!
you have one of the best youtube chanels ever , thank you for putting out this content
@AccountingStuff
5 жыл бұрын
Cheers Hamza!
@user-hl4hl9li6o
4 жыл бұрын
for real, just save my life two days before final
Hey James! I'm a first-year accounting major at my university here, and your videos have been amazing for reviewing and learning more about the content I learn in class. Keep up the great work!
@AccountingStuff
3 жыл бұрын
Cheers Dustin! All the best with your studies :)
Holy Crap James. I've watched this video at least 6 times, and I think I finally got it! Whoosh. My head hurts.... But it's a good hurt. Thanks again. I can't wait for the next video.....p.s. Before these videos, I wouldn't have gotten the ''It's accrual world'', thing on the mug..... I laughed out loud when you said it, and that made me feel pretty darn good! Cheers! Joanna
@AccountingStuff
5 жыл бұрын
Haha, I'm glad you managed to work it out! Cash Flow can sure be tough. On Monday I'm uploading another video on the Direct Method that gets into more detail so you might find that one useful as well. It's Accrual World is a classic! All the best 👍
I was working on my assignment on Cash flow methods, based on what my instructor taught, just couldn't wrap my head around, the operating activities difference in both methods. By watching these two videos for half an hour, my these concepts are crystal clear. Thanks James!
Yo! James, I gotta say, you are really really really really really good at not only making accounting interesting and easier to understand but also just making videos generally! like I can literally play your videos while I brush my teeth and I'll still be attentive and pulled in! Keep going dawg you're a hero to Accounting students.
@AccountingStuff
3 жыл бұрын
Thanks for your kind words!! Hope your studies are going well :)
Should we watch your videos in any particular order? I saw the first video and immediately bought the entire cheat sheet collection. The sheets are brilliant. Each one works as a mind map and corresponds to a video in your series. I am attempting to catch up in an entry-level accounting class. Thanks again for the engaging and entertaining series.
I can't thank you enough! Your videos have helped me refamiliarize myself with somethings long forgotten! Much appreciated!
@AccountingStuff
3 жыл бұрын
No worries Karey, I'm happy to help! All the best
Thank you so much for these videos. I just watched your P&L, Balance Sheet, and Cash Flow Statement videos and they are so well made and simple to follow!
Great video. I studied Accounting 8 years ago and I forgot almost everything lol. I am going to gad school for my MBA and having a project due on Dec 2020. Your videos help me a lot to review and study accounting. Thank you!
@AccountingStuff
3 жыл бұрын
No worries Tien, we all need to refresh ourselves on the basics from time to time. Best of luck with your MBA!
I love you. seriously this content is amazing. I could see you doing an online course and i would invest in it. You make the content so digestible and i am so grateful for it. People like you offer value to others and its so cool. I don't know how much money you are making on you tube but i hope you are doing well. because i want to see you grow and continue to make amazing content. Thank you man.
@AccountingStuff
5 жыл бұрын
Thanks for the kind words, I appreciate your support :)
あなたがゆっくり喋ってくれるので、とっても分かりやすい!
It is truly useful and eye-catching at the same time! I have watched the video from the beginning till the very end without feeling bored. It's awesome. Thank you for making such a great video!
@AccountingStuff
3 жыл бұрын
Thanks, I'm glad you enjoyed it!
No one explains accounting terms and principles as simply and as clearly as you so that even someone with non-accounting background like me can understand. Thank you so much
@AccountingStuff
2 жыл бұрын
Cheers Bernard, glad it's making sense :)
Thank you for this video! Your video taught me more than my lecturer has in 12 weeks 😁 also love the Harry Potter references!
@AccountingStuff
5 жыл бұрын
No worries Joanne! I'm a big HP fan so whenever there's a chance to involve it, I take it! haha
Helpful content and I still can't believe how much effort you put on to make your vids as appealing as possible
@AccountingStuff
5 жыл бұрын
Thanks mate! I love the process of making videos so it's fun to go overkill on these tutorials
Hey James! Love these videos. They are super helpful. I've missed a few lectures and this is a great catch-up for me, thank you!
@AccountingStuff
4 жыл бұрын
Hey Nash, thanks, it's great to know that the vids are helping you out
I love Harry Potter!! The Harry Potter theme made it so much more fun.
Thank you for being the first EVER accounting guy I can understand and UNDERSTAND! Cheers!
@AccountingStuff
5 жыл бұрын
No worries, thanks for watching :)
You've saved me 5 days of studying this chapter, thank you. You're God sent
@AccountingStuff
5 жыл бұрын
Glad to hear it helped !!
Thanks for the response and the video. Waiting for the next videos. The whole content is getting better and better with each video. Great Work!!
@AccountingStuff
5 жыл бұрын
Hey Rohith! No worries, I always have a great time making these videos. Thanks for the kind words!
Your videos are amazing! Thank you for educating us all on accounting and finances.
Hats off to u, Just the amount of effort, i mean, the narration, the editing, the music everything is amazing. Looking forward for a lot more of ur content
@AccountingStuff
4 жыл бұрын
Thanks Manem, glad you enjoyed it!
The hardest topic for me to understand so far. But you did an excellent job of explaining difficult concepts in very simple terms. So yes, I understand the cashflow statement very well after watching your videos. Thank you so much
@AccountingStuff
4 жыл бұрын
Great to hear it's making sense! The Cash Flow Statement confused me at first too!
I am so grateful for your videos! I hit a wall when I got to cash flow statements, and your video got me over it! I am going to watch all your videos to help cement the information I am learning through my accounting course.
@AccountingStuff
3 жыл бұрын
No worries Robin, we all hit the wall from time to time. You got this!
You are awesome man! Keep up the good work. Your efforts in videos and the value delivery are very apparent.
@AccountingStuff
5 жыл бұрын
Thanks mate!
It is precise, clearly pronounced and presented; simply well done. Keep it up.
@AccountingStuff
4 жыл бұрын
Thanks, I'm glad you think so! Appreciate the feedback
I just really understand the world of accounting when I keep on watching your videos. Well presented and explained! Thanku verymuch more power!
Thousand of thanks should i give to u, such a good video and it helps me to facing my difficulty while learning account since the final is coming soon. Whatever, man u deserved a a million or even more of thanks!!!
@AccountingStuff
4 жыл бұрын
Cheers Rose, good luck in your Final!
Thanks my guru in Accounting problems. I love the way you make it look so simple
Great explanation. Thank you! I'm studying for the CMA and your videos have been a great resource!
@AccountingStuff
3 жыл бұрын
Thanks Gregory, all the best with your studies!
Thank you so much James for such a great video. I am very new in accounting and finance and thought I will never be able to understand these concepts. You are amazing!
@AccountingStuff
3 жыл бұрын
No worries, hope it's making sense :)
Dude... THANK YOU!! Like so many people, I've been having trouble with the Statement of CF. You explain this and everything else so clearly and you even make it fun and enjoyable to watch. Swear... Best. KZread Channel. Ever.
@AccountingStuff
4 жыл бұрын
Cheers Kelz! Hope SoCF is making sense for you now
Your videos are so dramatic it makes accounting an even more interesting amd powerful skill. Every Acc Lessons you upload is like cracking another mysterious case.
@AccountingStuff
3 жыл бұрын
Cheers John, glad you're enjoying them!
As an accounting student studying abroad this channel has been a gift sent from god thanks a lot
What i couldn't wrap my head around for a whole evening you managed to explain in 12 minutes. Thanks alot!!
@AccountingStuff
3 жыл бұрын
Great to hear it's making sense :)
I praise God for your help. Thank you. I bought both of your Direct and Indirect Method as a show of appreciation for your effort. Thanks again.
Thank you so much for creating this content! It's so useful!
@AccountingStuff
5 жыл бұрын
No worries Cassie!
Really great videos! So helpful in understanding Accounting!
Thank you so much for this .. this was of great help .. may god bless you always for spending your tie to make this ... we need more videos like these .. please continue doing these .. coz we need more of people like you .. Mr james you are a GREAT at Accounts ... thank-you once again...😊😊
@AccountingStuff
5 жыл бұрын
Thanks for the kind words Thasleem!
God bless you man!
Bro, I actually love you. Such amazing videos
@AccountingStuff
3 жыл бұрын
Thank you!
Thank you so much for such excellent video 👍🏼
Just did my uni accounting exam and a HUGE cash flow question - thanks to you and these videos I knew what I was doing (hopefully)! Hurrah!
@AccountingStuff
3 жыл бұрын
Nice one! Glad to hear it went well :)
I'm using one of those accounting software, but its good to understand how it really works. Thanks again.
@AccountingStuff
3 жыл бұрын
No worries, I'm happy to help!
great content thank you James for the efforts
Wow! How can you sound flawless in your explanation. You're the best!
@AccountingStuff
2 жыл бұрын
Thanks buddy :)
Youre a savior!!! Studying for my BUS020 midterm rn
Assuming I pass my MBA accounting course, it will all be thanks to you! I purchased your bundle pack 'cheat sheets'....THANK YOU!
@AccountingStuff
3 жыл бұрын
Thanks for your support Karyn! Best of luck with your MBA, hope it's going well :)
@KarynLTapleyMDMBA
3 жыл бұрын
@@AccountingStuff lol, perfect 4.0....until accounting. We'll see if I can pull it out in the end!
@KarynLTapleyMDMBA
3 жыл бұрын
PS -Waving from Bellingham! Just saw one of the vids saying you were up in Vancouver! Small world!
@AccountingStuff
3 жыл бұрын
@@KarynLTapleyMDMBA You got this!
@AccountingStuff
3 жыл бұрын
@@KarynLTapleyMDMBA So close yet so far with the border closure! Hope you're keeping safe & well
Thanks for your excellent video!
you saveee meeee ! Send u my love and respect. Btw your video editing is soooo amazingggg
@AccountingStuff
3 жыл бұрын
Thank you!!
Thank you very much!Very useful
clear explanation , SUPERB bro
you are just amazing . accounting sounds more fun after watching your vedios
Great videos. They are incredibly helpful. Really appreciate the assistance.
@AccountingStuff
4 жыл бұрын
Cheers Gary, glad you're enjoying them!
You are killing it James thank you so much mate
@AccountingStuff
4 жыл бұрын
Cheers Mundher!
My accounting lecturer loves refering us to you when we get stuck. Don't know where we would be without your channel. Also absolutely love seeing a fellow potterhead😅
@AccountingStuff
3 жыл бұрын
Cheers Alex!
Hahaha, broom sticks and Nimbus 2001... Wow, I love the illustrations. You've given me a perfect bird's eye view on cashflows!! I appreciate the approach of explaining it from the bottom to the top.... Makes alot of sense!. Thank you for all the effort, God bless you more
@AccountingStuff
4 жыл бұрын
Thanks buddy!
You are good at this James! Thank you for this video!
@AccountingStuff
3 жыл бұрын
Cheers Sarah!
Thank you so much for these videos, I finally got it!!!
@AccountingStuff
2 ай бұрын
Great to hear it's clicking!
James is my accounting hero. Also, I use the Hogwarts common room youtube videos for background music to study to. I thought I had left one open until I realized the music was coming from this! Double hero points!
@AccountingStuff
3 жыл бұрын
I've done that in the past too!
Thanks for these informative and easy to understand videos
@AccountingStuff
3 жыл бұрын
No problem Vince! All the best :)
I couldn’t understand the statement of cash flows especially the indirect method and I knew you’d help and I was so right..!!🙌🏻
@AccountingStuff
4 жыл бұрын
Hey Sanyo, great to hear it's making sense!
Beautiful explanation, and special effects too
@AccountingStuff
4 жыл бұрын
Thanks Chinmay!!
This helped me so much. Explained in a way I just couldn't understand from reading the textbook and you managed to capture my easily distracted hamster brain's attention. My saving grace right before finals.
@AccountingStuff
3 жыл бұрын
Best of luck in your finals!!
This is absolutely brilliant
@AccountingStuff
Жыл бұрын
Thanks Arjun!
THNAK YOU for making it interesting and it's is very helpful ✨
@AccountingStuff
4 ай бұрын
No problem :)
Very nicely explained and easy to understand... Really appreciate James👍👍
@AccountingStuff
2 жыл бұрын
Cheers buddy :)
Guys the less we can do to James to repay back his amazing work is to spread his videos in all social media. Let help him to reach millions of subscribers.
@AccountingStuff
3 жыл бұрын
Cheers for your support buddy!
You are brilliant! Thank you so much!
@AccountingStuff
2 жыл бұрын
Thanks for your kind words!
You are an absolute king
@AccountingStuff
3 жыл бұрын
Thanks :)
ThankYou so much These videos are much more clearer than our lecturers.
@AccountingStuff
4 жыл бұрын
No worries, hope it's making sense for you
I'm a student of Charterd Accontancy india , i loved the way you explain...
@AccountingStuff
4 жыл бұрын
Thanks mate
Thank you man. God bless you
@AccountingStuff
3 жыл бұрын
No problem!
26th video, your wonderful explanation will lighten our costed mind
I’m a baby investing who didn’t know much about accounting. Your videos are so helpful
These videos are fantastic. You make accounting fun very accessible. Wonder is there a video where you put it all together, examples of how the finances of a company are run through the books, reporting schedules, etc. Sort of a bird's eye view.
@AccountingStuff
4 жыл бұрын
Thanks! I haven't made a video like that yet but I definitely plan to
Great channel and great vids 👏🏾
@AccountingStuff
4 жыл бұрын
Cheers!
thank you so much! You saved my life
@AccountingStuff
2 жыл бұрын
No worries, I'm happy to help!
Awsome Stuff Mate Helped me alot
@AccountingStuff
3 жыл бұрын
Thanks buddy, that's great to hear!
Every time I am confused, I will come back to your channel. I have an exam next week, so here I am :). You are better than my professor!
@AccountingStuff
4 жыл бұрын
Good luck in your exam!!
You my life saviour 🤗
You are mazing! you have done the best.
@AccountingStuff
2 жыл бұрын
Thank you! 😊
gal thank you for such wonderful content im a accounting student and Thank you cause this is a big help 😊
@AccountingStuff
3 жыл бұрын
No worries Liezel! Great to hear you're finding it helpful :)
Thanks dude, saved us a fortune
@AccountingStuff
4 жыл бұрын
Happy to help!
great breakdown, thank you
@AccountingStuff
3 жыл бұрын
Cheers :)
Splendid James! Sharing this to my students
@AccountingStuff
3 жыл бұрын
Thanks Marjory, glad you enjoyed it :)
Awesome videos mate, you've got a real talent
@AccountingStuff
4 жыл бұрын
Cheers mate!
How exciting can you make accounting ? This exciting !!! Amazing videos ! thank a lot !
@AccountingStuff
4 жыл бұрын
Cheers! I'm not quite sure what you're asking. Could you please clarify?
Got my resit for accounting on wednesday, wish I found this channel earlier :')
@AccountingStuff
4 жыл бұрын
Good luck Tom! Hope it goes well
i learned so much from you thank you for your efforts
@AccountingStuff
4 жыл бұрын
Cheers, that's great to hear
I like your videos it is so much easy to understand concepts
@AccountingStuff
3 ай бұрын
Thanks, great to hear you're finding them useful :)
Superb explanation!
@AccountingStuff
3 жыл бұрын
Glad you think so!
Hey nice video. I like the way you presented.
@AccountingStuff
5 жыл бұрын
Thanks Dharmesh, I'm glad you enjoyed it 🙂
Lovely. Broken down well
@AccountingStuff
4 жыл бұрын
Thanks Anthony!
cash flow statement used to be a real pain for me, but before I watched your video:))) thank you so much!!!
@AccountingStuff
4 жыл бұрын
You're very welcome. Hope it's making sense for you
You are love bro ❤️, you explain things awesome.
@AccountingStuff
3 жыл бұрын
Cheers buddy
such high quality!
@AccountingStuff
4 жыл бұрын
Cheers Brandon!