LearningCat: Cash Flow Statement

Direct Method of Cash flow statement
The Direct method of Cash flow statement? The direct cash flow approach uses actual cash inflows and outflows that are taken directly from business activities. This means that instead of employing the accrual accounting approach, cash is measured as it is received or paid. In accrual accounting, revenue is recorded as it is earned rather […]
The Indirect Method of Cash Flow Statement
Let’s get straight to the point: the indirect method is how most businesses prepare their cash flow statement. It’s practical, straightforward, and links the cash flow to the income statement. But why? Well, it’s simpler and way easier to handle than the direct method, especially when things get complicated. Instead of tracking every single cash […]
Cash Flow Statement: Purpose and Structure Simplified
Cash flow statements are one of the crucial parts when we consider financial statements. Business needs this statement to track cash intake and expenditure. Unlike an income statement, which only shows profits and losses, or a balance sheet, which displays the assets and liabilities, the cash flow statement provides information regarding cash. Understanding this statement […]