How to Calculate Investment Spending

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Most investors want a return on their investment, including business organizations. Just like individuals, businesses can earn an income through both operations and investments. Investments are listed on the balance sheet and can be found in the company's annual report as assets. Common line items include securities and property, plant and equipment. While the balance sheet provides a listing of the value of assets, it does not separate the current year's investment spending from total asset value. A simple calculation will give the amount of investment spending.

Obtain the company's most recent annual report. You can usually download this from the company's website or request it by contacting the investor relations department.

Turn to the cash flow statement. This is usually the last of three financial statements in the annual report.

Identify the section "Cash Flow From Investments." There are three sections to the cash flow statement, and this section details all investment spending.

Calculate the company's investment spending. Total all outflows in the "Cash Flow From Investments" section. Outflows are denoted with parentheses "()" on the cash flow statement. For example, assume investment spending is $40,000 for investment securities and $100,000 for property. The total investment spending is $140,000.

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About the Author

James Collins has worked as a freelance writer since 2005. His work appears online, focusing on business and financial topics. He holds a Bachelor of Science in horticulture science from Pennsylvania State University.

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