Cash is the most valuable item in any business. Whole business will depend upon cash. The reporting of the cash should be according to the proper rules and regulations. Its very important to match both sides of profit and loss, because it tells us about the revenue and expenses of the firm and through that the correct cash flow of company will find out. The cash flow statement shows that the how much cash will be used and how much cash is remain there in business and how much more cash a firm needs. The cash flow statement does not include the noncash transactions of the company. It contains a lot of calculations that is why cash flow assignment is not easy for students.
Cash flow statement is the financial report that shows the inflow and outflow of the cash and similar cash transactions. Cash flow statement helps out the business to take the business-related decisions in term of money because it shows the income and expenditure of business. It does not show that the business is for profit or not, but it shows the cash position of the company.
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