DFS - cash flows - calculating payments to acquire fixed assets
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Hi,<BR><BR>Can anyone tell me if there is a simple way to calculate payments to acquire fixed assets when doing a cash flow statement.<BR>Do you deduct depreciation or not???<BR><BR>Found this a bit confusing. Some help would be appreciated.<BR><BR>Thanks in advance!<BR>
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DFS - cash flows - calculating payments to acquire fixed assets
Take fixed asset NBV figure from earlier year and subtract from later year (i.e if they give you accounts for 2005 and 2004 then subtract total FA (NBV) for 2004 from 2005). This will give the movement in FA for the year.<BR><BR>Add back NBV of any assets sold in the year<BR><BR>Add back current years depreciation<BR><BR>This should then give the true amount for assets acquired during the year.<BR><BR>If this doesn't work, let me know. I'm writing this blind cos am at work and don't have my books to hand. Will double check methodology tonight if you let me know one way or another.<BR><BR>:-)0 -
DFS - cash flows - calculating payments to acquire fixed assets
Brilliant! Thanks Nicky. It works everytime.<BR><BR>:-)0 -
DFS - cash flows - calculating payments to acquire fixed assets
I've learn't this formula<BR><BR>Opening balance (Fixed Assets) - N.B.V. (of any fixed assets sold in year) - Depreciation (total for year) & additions = Closing balance<BR><BR>You will have all information apart from additions and if you slot all the information in, it is easy to work out additions for year.0 -
DFS - cash flows - calculating payments to acquire fixed assets
I always go back to the T account, that's the only way I can get my head around it.<BR>I also go back to the T account when calculating the figures for tax and dividends for use in a cashflow.<BR>That way there's not as many rules for you to learn!<BR>0