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Cash Flow Opens Doors
Manage episode 316963240 series 3301024
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Understanding cash flow is a key component in every business.
KEY TAKEAWAYS
- A cash flow statement (CFS) is a financial statement that summarizes the amount of cash and cash equivalents entering and leaving a company.
- The CFS measures how well a company manages its cash position, meaning how well the company generates cash.
- The CFS complements the balance sheet and the income statement.
- The main components of the CFS are cash from three areas: operating activities, investing activities, and financing activities.
- The two methods of calculating cash flow are the direct method and the indirect method.
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