0
yh
Wiki User
∙ 13y ago
Add your answer:
Earn +20 pts
Is it possible for a company to have a profit and a negative cash flow?
No
Formula for average annual profit?
Total Cash Flow / 5years = Average Annual profit
Why does profit not equal cash flow?
Cash flow and profit are two different concepts. Profit includes non-cash items such as amounts owed by customers but not yet turned into cash (i.e., not yet paid by the customers). Profit is also net of debts currently owed by the company by not yet paid out in cash by the company (i.e. its accounts payable). Cash flow simply tracks the movement of cash (actual money) when received and paid out by a company, regardless of whether income was earned or expenses incurred.
What is the difference between profit and cash flows?
Profit mean that when a company sales turnover more so extra income that we get is profit. Cash flow means inflow & outflow of cash when there is any expenses or income earned.
What is cash profit?
cash gain,after adding back the nett profit(after deducting taxes)to the internally generated expenditure like depreciation and amortizatio. it is some times reffered as cash flow
What managerial assessments may you make about an organization that has a profit and negative cash flow in the same accounting period?
What managerial assessments may you make about an organization that has a profit and negative cash flow in the same accounting period?
Is cash flow the same as income?
No a Profit & Loss statement will tell you net imcone, which is not the same as cash flow. Cash Flow is the result of a sources and uses of funds statement which is often a better indication of how a buisness is performning that the P&L.
What does cash flow per share mean?
Cash flow per share means how much any company has earned cash flow per outstanding share same like net profit per share which is as follows: cash flow per share = total cash flow / number of outstanding shares
What managerial assessments can you make about a company that has a profit and a negative cash flow in the same accounting period?
There are many managerial assessments you could make about a company that has a profit and a negative cash flow in the same accounting period. You could say that there is an error or that temperature changed dramatically for example.
In Cash flow statement what is direct method and indirect method?
Direct and indirect method of preparing cash flow statement is same with only one difference which is under indirect method 'Cash flow from operating activities' is prepared by adjusting the net profit amount for non cash items while 'Cash flow from financing activities' and 'Cash flow from investing activities' is prepared in same manner in both methods.
Is it possible for a company to have a profit and a negative cash flow?
No
What is the difference between cash flow and cash?
Profit mean that when a company sales turnover more so extra income that we get is profit. Cash flow means inflow & outflow of cash when there is any expenses or income earned.
What effect does depreciation have on the cash flow associated with an investment in a fixed asset?
Depreciation is a non cash flow item which reduces the profit figure only so in cash flow statemnet we will add this figure to operating profit then we will get accurate cash flows from operating activities.
What is the cash flow of a company?
A company's cash flow is the amount of cash (or income) that goes into a business. Cash usually comes from a product or service that a company sells for profit.
What does a negative cash flow to creditors mean?
Cash flow is any money that comes into or goes out of a business. A negative cash flow would represent debt or a lack of profit for a company. This can be a red flag to creditors.
What is the profit or loss on sale of fixed assets?
In cash flow from operating activities in cash flow statement, loss on sale of asset is included to net profit to arrive at cash flow from operating activities and shown under cash flow from investing activities as this is part of investing activities but in normal net income it is shown as an adjustment which needs to be adjusted to arrive at cash flow from operating activities.
What is the purpose of operating cash flow?
The purpose of operating cash flow is to achieve a financial and fiscal balance or profit. Proper cash flow management is the key to success for any business.
