Chapter 4
Reporting Cash Sources and Uses in the Statement of Cash Flows
IN THIS CHAPTER
Clarifying why the statement of cash flows is reported
Presenting the statement of cash flows in two flavors
Earning profit versus generating cash flow from profit
Reading lines and between the lines in the statement of cash flows
Offering advice and observations on cash flow
You could argue that the income statement (see Chapter 2 in Book 3) and balance sheet (see Chapter 3 in Book 3) are enough. These two financial statements answer the most important questions about the financial affairs of a business. The income statement discloses revenue and how much profit the business squeezed from its revenue, and the balance sheet discloses the amounts of assets being used to make sales and profit, as well as its capital sources. What more do you need to know? Well, it’s also helpful to know about the cash flows of the business.
This chapter explains the third primary financial statement reported by ...
Get Starting a Business All-in-One For Dummies, 3rd Edition now with the O’Reilly learning platform.
O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.
