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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.
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Is profit the same as cash flow?
yh
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
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
Is profit the same as cash flow?
yh
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 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.
Formula for average annual profit?
Total Cash Flow / 5years = Average Annual profit
What is the definition of a companys cash flow?
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.
Why is that net income does not equal cash provided by operations?
Net cash flow and net profit is not same due to inclusion of non cash items in net income that's why net income is adjusted for non cash items while preparing cash flow from operating activities.
HOw can a business lose money for many years and still have plenty of cash?
Cash flow is different from profit. A business can have lots of profit, but low cash flow. This is due to the Accruals basis in accounting. A customer could pay on credit, it's recorded as profit on the moment of transaction but the organisation physically does not have the cash yet.
Why the increase or decrease in cash is different to the profit or loss?
Cash does not equal profit. For example, a depreciation charge is a cost to the business, but no actual cash is expensed.
How you can convert the profit as per profit and loss into cash flow items?
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