Hi everybody. In the previous class, we learned how to make balance sheet and income statement. In this class, we are going to learn how to calculate cash flow. Before we calculate operating cash flow, let's move balance sheet and income statement in the position shown in the slide. That is balance sheet is in column E and income statement is in column F. Next, let us start with operating cash flow. Operating cash flow is earnings before interest and taxes plus deppreciation minus taxes. Earnings before interest and taxes is calculated in an income statement and it is in cell M6. Depreciation is in cell M5. Taxes are in cell M9 then operating cash flow is $1,840. Next, let's work on net capital spending. First, ending net fixed assets are in cell C8, or cell G5. Here we are using cell C8. Beginning, net fixed assets are in cell E8 or F5. Depreciation is in cell M5. Net capital spending is ending net fixed assets minus beginning net fixed assets, plus depreciation. So, it is $1,100. Next lets calculate change in net working capital. First, ending net working capital is current assets in 2015 minus current liabilities in 2015. So, it is $1,250. Beginning net working capital is current assets in 2014 minus current liabilities in 2014. So, it is $1,200. Change in net working capital is ending net working capital minus beginning net working capital. So, it is $50. Next, move your completed operating cash flow statement to cell A14 and start calculating cash flow from assets. As you learned, cash flow from assets is operating cash flow minus net capital spending minus change in net working capital. First operating cash flow is in cell B19, so it is $1,840. Net capital spending is in cell B24 and it is 1,100. Change in net working capital is in cell B28 and it is $50. Cash flow from assets is 1,840 minus 1,100 minus 50 is equal to $690. Next, let's calculate cash flow to creditors and stock holders. First interest paid is in cell M7, and it is $160. Net new borrowing is long-term debt in 2015 minus long-term debt in 2014 and it is minus $500. That is, Yonsei Corporation paid off $500 of long-term debt, so its long-term debt has been reduced by $500. So, cash flow to creditors are sum of interest pay and long term debt pay. That long term debt pay is negative net new borrowing. So, cash flow to creditors is interest paid minus net new borrowing and it is $660. Next, cash flow to stockholders is dividends paid minus net new equity raised. Dividends paid is in cell C6. Net new equity raised is equity in 2015 minus equity in 2014 minus addition to retained earnings in 2015. So, it is $180. Cash flow to stockholder is then $210 minus $180, it is equal to $30.