In: Finance
Walk me through a Cash Flow Statement. NOT FOR ANY SPECIFIC COMPANY, JUST IN GENERAL.
PLEASE GIVE A THROUGH ANSWER TO THIS
Cash flow statement is a financial statement which shows a total cash outflow or total inflow from any company or organisation. Cash flow statement prepares for varifying the actual cash held with the company.The Main focus of cash flow statement is on cash basis accounting.
The cash flow statment is covers three basic points by which be can easily prepare cash flow statement. They are-
1. Cash flow from Operations - Cash flow from operations defines cash flow from all operational business activity.If any Non- Cash items like Dividend, Goodwill written off. They are firstly deducted from the profit then at last these items are added back because they have nulify effects on the cash items.
2. Cash flow from Investing Activities - These activities contains cash flow from purchase or sale of any fixed assets like plant and machinery, Furnitures and fixtures, Mavhinery. On other words any change in capital expenditure are covered under cash flow from investing Activities.
3. Cash flow from Financing - These Activities contain cash generated or paid from/to banks like any loan taken from banks or any payment made of loan. It mainly contains the financing field of the company or organisation like any payment of interest of debentures or bonds or cash paid on buy back of shares etc.
Hope it helps you.
Thanks