While preparing Cash Flow statement, we add 'interest on debentures' to Calculate Cash flow from operating activities. But we don't do this while calculating Funds from operations in Fund Flow. Can anyone clarify why this is done? Thanks!
While preparing Cash Flow statement, we add 'interest on debentures' to Calculate Cash flow from operating activities. But we don't do this while calculating Funds from operations in Fund Flow. Can anyone clarify why this is done? Thanks!
Cash flow statements
Cash from operating activities: while calculation Operating profit nefore working capital chages, we should add interest on debentures.
Cash from financing activities: it will show as out flow of cash
Funds flow statement:
Funds from operations: Interest on debentures to be add back to Net profit. i.e. sources of fund.
Under funds flow statement payment amount should shown as application of Fund.
Note: Calculation part for Operating profit nefore working capital changes under Cash flow and Funds from operations under funds flow is Similar.
Could you please tell me of what all comes under Cash flow from operations?
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