Thursday, November 20

Cash Flow from Operating Activities (CFO)

Cash flow that arises from normal operations such as revenues and cash operating expenses net of taxes.

Operating activities

· related to normal production and trade, include
· sales and related costs
· pay taxes
· buy short-term assets
· take long term liabilities to support ordinary business

Cash inflow (+)
· Revenue from sale of goods and services
· Interest (from debt instruments of other entities)
· Dividends (from equities of other entities)

Cash outflow (-)
· Payments to suppliers
· Payments to employees
· Payments to government
· Payments to lenders
· Payments for other expenses

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