Editing Cash flow (section)

==Business' financials==
{{Citation needed section|date=January 2024}}
The (total) net cash flow of a company over a period (typically a quarter, half year, or a full year) is equal to the change in cash balance over this period: positive if the cash balance increases (more cash becomes available), negative if the cash balance decreases. The total net cash flow for a project is the sum of cash flows that are classified in three areas:

* [[Operating cash flow|Operational cash flows]]: cash received or expended  as a result of the company's internal business activities. Operating cash flow of a project is determined by:
**OCF = incremental earnings+depreciation=(earning before interest and tax−tax)+depreciation
**OCF = earning before interest and tax*(1−tax rate)+ depreciation
**OCF = (revenue − cost of good sold − operating expense − depreciation)* (1−tax rate)+depreciation
**OCF = (Revenue − cost of good sold − operating expense)* (1−tax rate)+ depreciation* (tax rate)

Depreciation*(tax rate) which locates at the end of the formula is called depreciation shield through which we can see that there is a negative relation between depreciation and cash flow.

* Changing in net working capital: it is the cost or revenue related to the company's short-term asset like inventory. 
* [[Capital spending]]: this is the cost or gain related to the company's fix asset such as the cash used to buy a new equipment or the cash which is gained from selling an old equipment.

The sum of the three component above will be the cash flow for a project.

And the cash flow for a company also include three parts:

*[[Operating cash flow]]: refers to the cash received or loss because of the internal activities of a company such as the cash received from sales revenue or the cash paid to the workers.
*Investment cash flow: refers to the cash flow which related to the company's fixed assets such as equipment building and so on such as the cash used to buy a new equipment or a building
*Financing cash flow: cash flow from a company's financing activities like issuing stock or paying dividends.

The sum of the three components above will be the total cash flow of a company.