Plumb Accounting Basics | Statement of Cash Flow

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Plumb Accounting Basics: Statement of Cash Flow

Plumb outsourced accounting


A. Reports cash receipts and cash payments during a period

B. Cash means cash equivalents

C. Three sections

1. Operating Activities

a. Revenues and expenses from firm’s major line of business

b. Collections from customers =

i. Sales Revenue (+ decrease in A/R or – increase in A/R)

c. Receipt of interest and dividends

d. Payments to suppliers =

i. COGS (+increase in inv. Or – decrease in inv.) and

ii. (+decrease in A/P or – increase in A/P)

e. Payments of operation expenses =

i. Operating expenses other than salaries, wages and depreciation (+ increase in prepaid expenses or – decrease in prepaid expenses) and

ii. (+ decrease in accrued liabilities or – increase in accrued liabilities)

f. Payments to employee =

i. Salary and wage expense (+ decrease in salary and wages payable or – increase in salary and wages payable)

g. Payments of interest and taxes

2. Investing Activities

a. Increases and decreases in cash due to dispositions or purchases of firm’s assets

b. Sale of plant assets

c. Sale of investments

d. Cash received on loans receivable

e. Acquisition of plant assets

f. Acquisition of investments

g. Loans made

3. Financing Activities

a. Increases and decreases in cash from investors and creditors

b. Stock issuance

c. Sale and purchase of treasury stock

d. Borrowing money

e. Payments of dividends

f. Payments of principle on debts



Plumb Accounting provides expert services and support to accounting departments and growing organizations that need added expertise but do not want the burden of full-time Controller or CFO.

Services Offered:

  • Outsourced Accounting
  • Outsourced Bookkeeping
  • Policy and procedure review
  • Audit preparation
  • Budget review and preparation
  • Accounting systems/software analysis
  • M & A Accounting
  • Performance indicator development
  • Cash flow forecasting
  • Software upgrades
  • Monthly financial statements
  • Cash management
  • Vendor management
  • Management reporting
  • SEC reporting

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