From the course: Financial Accounting Part 1
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Statement of cash flows: Examples
From the course: Financial Accounting Part 1
Statement of cash flows: Examples
- We now know that the statement of cash flows summarizes a company's cash flows in three different areas: operating, investing, and financing. Operating, those are cash inflows and outflows from what a business does every single day. Investing, cash inflows and outflows from changing the productive capacity of a business to the purchase and sale of long-term assets. Financing, cash inflows and outflows from dealing with banks and shareholders. Let's take a look at a few companies with which we are familiar. Tesla, Elon Musk's Electric Car Company. Nordstrom, a family run chain of high-end retail clothing stores. And Frontier Airlines, a discount airline in the US market. Each company's operating, investing, and financing cash flows are summarized here. Let's take a look at Tesla first. The statement of cash flows tells the story of this company in graphic detail. First, from operations, Tesla is not generating any cash…
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