Revision of single entity cash flows

In this lesson

1. 0:00 Calculating tax paid from liabilities
2. 0:50 Working out PPE additions and disposals
3. 3:42 Finding dividend payments from retained earnings
4. 4:14 Computing operating cash flows step by step
5. 6:41 Calculating interest and tax paid in cash flow

About this lesson

We cover four essential techniques: calculating tax paid using opening and closing liabilities, working out PPE additions or disposals using the carrying value bridge, finding dividends paid from retained earnings movements, and deriving operating cash flows by adjusting profit for non-cash items and working capital changes. These calculations are fundamental to the cash flow statement section of Financial Reporting and Financial Management papers, and mastering them will help you handle both straightforward and complex cash flow questions with confidence. The lesson works through practical examples step by step. You'll see how to use the balancing figure method to find missing cash movements, how to separate interest accruals from trade payables when calculating actual cash paid, and how to handle depreciation, revaluations, and disposals in PPE movements. Each technique builds on the same logical structure: opening balance plus additions minus reductions equals closing balance, with the unknown figure calculated as a balancing item. By the end, you'll understand not just the mechanics but when and why to apply each adjustment, making you ready to tackle real exam questions where some figures are given and others must be derived.

Duration: 8m