When it comes to mastering cash flow management, there are three main components you should be aware of: cash flow from investing, cash flow from operations, and cash flow from financing.
Cash Flow from Investing: In cash flow investing, it records the purchases and cash flow from sales of long-term investments, which are like fixed assets. It includes plants, equipment, and property. The included products are buildings, furniture, land, vehicles, etc.
Cash Flow from Operations: The cash flow from operations gives an account of aggregate cash from the statement of income originally announced on an actuarial basis. The products or items included are income taxes payable, accounts receivables, and accounts payable.
Cash Flow from Financing: The cash flow from financing accounts for the debt and equity transactions. If any cash flow that, however, includes the sale of stocks or repurchases, dividends payment, and bonds, it will be considered as cash flow from financing.