Join Jim Stice for an in-depth discussion in this video Introduction to the statement of cash flows, part of Running a Profitable Business: Understanding Cash Flow.
- The Statement of Cash Flows has three sections.…- Okay, don't tell me.…Okay, I don't know, go ahead and tell me.…- Yeah.…The three sections are Operating activities,…Investing activities, and Financing activities.…- Okay, which of these three sections is the most important?…- Well, the most important section…of the Statement of Cash Flows is Operating activities.…The Operating activities are the things…that a business does every day,…such as collect cash from customers,…pay employees, pay suppliers for inventory purchases.…Paying for electricity, and so forth.…- Why is the Operating activity section the most important?…- Because the first thing we wanna know…about a company's cash flow,…is whether the company's daily operations…are generating cash, or are using cash.…
- Okay, so what's the next most important thing,…in the Statement of Cash Flows?…- The next most important thing is to compare…the amount of cash generated from Operating activities…to the amount of cash needed for Investing activities.…- All right, but what are Investing activities?…
Want to hear more from Jim and Kay? Learn about all three types of accounting—financial, managerial, and income tax—in their Accounting Fundamentals course.
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- Differentiating between net income and operating cash flow
- Categorizing cash flow
- Using financial data to deduce cash flow
- Managing operating, investing, and financing cash flows
- Typical cash flow patterns
- Converting net income into operating cash flow
- Improving operating cash flow
Skill Level Intermediate
1. The Importance of Cash Flow Analysis
2. Overview of the Statement of Cash Flows
3. Using Cash Flow Data to Make a Loan Decision
4. Converting Income Statement Data into Operating Cash Flow Data
5. Managing Cash Flow
6. Cash Flow Numbers for Some Real Companies
The danger of free cash flow3m 56s
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