How to Calculate Cash Flow & Prepare a Cash Flow Statement | IE Consultant
A cash flow statement is about documenting where the money is going in your business and whether you’re suffering a loss or making a profit. Business Trends contacted a variety of experts to get the lowdown on how to calculate cash flow and prepare a cash flow statement which combines the numbers from any financing, operations and investing your business does. Cash flow is the lifeblood of a business — In fact, a study found over 80% of business failure can be attributed to poor cash flow issues. How to Calculate Cash Flow Here is how you can start to put those numbers together into a statement using these three simple steps to understand formulas. Operating Cash Flow: This is one of the fundamental formulas that you’ll need in order to get everything else right. It’s an important number that small businesses can use to determine whether they have enough finances to expand or if they need outside help. Simply put, this is the amount of money your business makes fro