A cash flow from operating activities measures the movement of cash from transactions and

other activities relating to our day - to - day operations. The transactions such as accounts
receivables, sale of goods, depreciation, non-cash are recorded in Operation Activities. Cash
flows from operating activities is important for the business in the long run, because cash
generated from operating activities is used to cover the expenditure of the business.

A positive cash flow indicates that the company is performing well and is generating profits
as it is generating enough cash flow to meet all the expenses. It also indicates that the
company has a good financial health.

A negative cash flow indicates that company is unable to meet its day – to – day operations
and hence it is unable to generate enough cash flow to pay for its expenses. This makes
unfavourable condition for the creditors, suppliers as the risk is very high.

The company is using indirect method. It performed significantly well in 2021 than in 2020.
The company generating a negative cash of ($10,022) in 2020 to generating positive cash of
$23,548 in 2021. The company also had drastic increase in net income from negative ($46,848) in
2020 to positive $14,253. This shows that company has improved its day to day activities and is in
good financial health.

Cash used to purchase long- term or non-current assets which will hold a value in the future is
provided by cash flow from investing activities. Investors get an idea about where their money is
invested.

Positive cash flow from investing activities indicates that company is able to gain good returns from
its investment. Selling of fixed assets and securities are some ways to generate positive cash flow.

A negative cash flow indicates that company is not making proper decisions regarding the acquisition
of assets.

The company has invested in purchasing equipment, which has led to generate negative cash
($7,115) in 2021, but this means that company is expanding aggressively has it had positive net cash
of $938 in 2020. This indicates company will get good returns in the future.

The transfer of money from between company’s owners, investors, and creditors is recorded by the
cash flow in Financial activities. This data shows all the funding – debt, stock, dividend etc that were
used to run the business.

A positive cash flow indicates that company is generating more cash by creating assets than
spending. The company can generate positive cash flow by issuing shares and selling it to investors.

A negative cash flow means money is leaving the company then coming which means decrease in
assets. It occurs when company is paying dividend or buying back shares.

The company is generating negative net cash ($35,748) in 2021 as compared to its previous year
$32,454 in 2020. This may happen because company didn’t receive a good amount from insurance
of debt in 2021 compared to 2020. Company only got $6,469 in 2021 compared to $26,692 in 2020.