Cash Flows The reporting of the cash flows during the period in the cash flow statement is classified into following categories:- Operating activities Investing activities Financing activities Categorization made based on the activity provides information that allows users to evaluate the impact of those activities on the financial position of the entity and the amount of its cash and cash equivalents. It may also be helpful to assess the relationships among those activities. When an entity enters into a single transaction, it may include a mix of cash flows that are categorized differently based on their characteristics. For example, installment for an acquisition of a fixed asset on hire purchase basis includes both the component of interest and loan, the interest element falls under financing activities and the loan element fall under investing activities. Cash flows from Operating activities In simple term Cash flows from operating activities me...