Accounting theory

Accounting theory

In accounting terms, operating cash flow refers to the cash generated by the company through its day to day operations. It shows the ability of the company to generate cash through its main operations. While operating cash flow refers to the cash generated, net income refers to the profit after tax, also known as net profit. It is the left over money after all the expenses have been deducted from the company's revenue. Unlike net profit, gross profit only takes into account the cost of goods sold. It is referred to as the profit of the company after deducting ...