Question

Which one of the following is representative of typical cash flows from operating activities

Answer 1

Cash Flow from Operating Activities = Net income + Noncash Expenses + Changes in Working Capital.

examples

✓ Cash receipts from the sale of goods and services

✓ Inventories, tax assets (deferred and credits), accounts receivable, accrued revenue and deferred revenue are common items of assets for which a change in value will be reflected in cash flow from operating activities.

✓ Accounts payable, tax liabilities and accrued expenses are common examples of liabilities for which a change in value is reflected in cash flow from operations.