ShmoopTube
Where Monty Python meets your 10th grade teacher.
Search Thousands of Shmoop Videos
Principles of Finance: Unit 3, Cash Flow From Investing Activities 13 Views
Share It!
Description:
What are cash flows from investing activities? And we're talking about investing in your own company here. Not putting $2 on Runs With a Limp to Place.
Transcript
- 00:00
Principles of finance Ah la shmoop cash flow from investing
- 00:05
activities All right Remember that investing in this sense means
- 00:09
investing in one's own company right back to the filings
- 00:14
with the first lines A great example Purchases of tools
- 00:17
die and molds different kind of die there Totally spot
Full Transcript
- 00:22
on for doll making companies Yeah It's pretty obvious that
- 00:26
while they need these things and that they should own
- 00:29
them since this is pretty much their core business Well
- 00:31
the company burned sixty nine million dollars buying them in
- 00:34
this period and they will likely not last forever So
- 00:37
you'd look for the company to depreciate their value over
- 00:41
some logical period of time All right Well the next
- 00:44
lines forty two million dollars for other property plant equipment
- 00:47
Well wonder what that could be Plastic hair A barbie
- 00:50
mobile testing facility Maybe barbie blue to write Maybe not
- 00:54
Well whatever the case they burned forty two million bucks
- 00:57
buying other peopie any in this reporting period So then
- 01:00
we see thirty three million dollars has payments for acquisitions
- 01:04
Well that's Interesting Wonder what company they bought and note
- 01:08
that this is listed in investing category not the financing
- 01:11
Category Why Well because they're buying things directly for the
- 01:15
operations of the company It was an acquisition of an
- 01:19
operating thing not an acquisition of something solely for the
- 01:23
financial management of the company like the acquisition of the
- 01:26
company's own stock because while they thought their stock was
- 01:29
cheap all right well the next lines a gain of
- 01:31
sixteen million dollars from foreign currency Edging the dollar was
- 01:35
relatively strong against the brexit ing europe and an imploding
- 01:39
latin america and a dying middle east under cheap oil
- 01:42
panes well earned So they made a cash game of
- 01:45
sixty million dollars from whoever bet along the u s
- 01:48
dollar in january of two thousand sixteen was their gains
- 01:51
on foreign currency trades That's not normally the domain of
- 01:54
a plastic doll making company but they have to note
- 01:57
it when they get lucky And yeah good job Give
- 02:00
that gala freak All right ignore other again and you
- 02:03
get to net cash flows used for investing activities as
- 02:08
another big fat loss of one hundred twenty four million
- 02:10
bucks Ouch When will the bleeding stop and it's worth
- 02:13
noting here that they burned two hundred forty million dollars
- 02:16
From operations and just burned another one hundred twenty four
- 02:19
million from investing All right well in total thus far
- 02:22
in the first six months here of two thousand sixteen
- 02:25
mattel has burned three hundred sixty four million dollars The
- 02:29
titanic appears to be sinking We can hear a celine 00:02:33.358 --> [endTime] dion right now
Up Next
GED Social Studies 1.1 Civics and Government
Related Videos
What is bankruptcy? Deadbeats who can't pay their bills declare bankruptcy. Either they borrowed too much money, or the business fell apart. They t...
What's a dividend? At will, the board of directors can pay a dividend on common stock. Usually, that payout is some percentage less than 100 of ear...
How are risk and reward related? Take more risk, expect more reward. A lottery ticket might be worth a billion dollars, but if the odds are one in...