Cash flow: operating, investing and financing
Track cash entering and leaving a business
Try the interactive lessonLet’s make it simple.
The cash flow statement tracks cash entering and leaving the business. Operating activities run the business; investing activities buy or sell long-term assets; financing activities raise or repay capital.
Picture this.
A bakery collects $500 from customers, buys a $900 oven, and receives a $600 bank loan. Those are operating +$500, investing −$900, and financing +$600: cash increases by $200 overall.
Check your understanding
Operating cash is +$500, investing cash is −$900, and financing cash is +$600. What is the net increase in cash?
Think it through, then reveal the explanation
$500 − $900 + $600 = $200. The categories show why cash changed.
Build the bigger picture.
- Operating activities
- Investing activities
- Financing activities
- Net change in cash
The three categories combine to explain the change in cash.
Now make it move.
Bring this idea to life with interactive practice, a 3D illustration and tips along the way. Your progress stays on your device.
Practice Follow the Cash