Discuss the Statement of Cash flow elements and how to inter

Discuss the Statement of Cash flow elements and how to interpret each element in relation to the other financial statements of a corporation. When is net cash out flow from operations a good thing? When is net cash outflows from investing a good thing? When is net cash outflow from financing a good thing? When answering these questions, keep in mind the relation to the other statements of the corporation

Solution

Statement of cash flow

Step-1: Importance of cash flow statement:

Step-2: Components/Categories of cash flow statement

Step-3: Relationship of each element in relation to other financial statement:

Step-4: Net cash out flow from operations:

Step-5: Net cash flow from investing activity:

Step-6: Net cash outflow from financing activities: