Question

To arrive at operating cash flows, you should start with _______, _______ non-cash items and then adding or subtracting changes in working capital.

Answer 1

To arrive at operating cash flows, you should start with net income, adding non-cash items and then add or subtract changes in working capital.

A measure of the amount of money made by a company's regular business operations is called operating cash flow (OCF). Operating cash flow shows if a business can produce enough positive cash flow to support and expand its operations; if not, it may need outside finance for capital growth.

An essential metric for assessing the financial performance of a company's main business operations is operating cash flow.

A cash flow statement's opening part, which also contains cash from investing and financing activities, shows operating cash flow.

The indirect method and the direct approach are both ways to show operating cash flow on a cash flow statement.

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