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The Cash Flow Statement is one of the 3 main Financial Statements. It will show you how effective a business is in managing its cash. Most companies apply Accrual Accounting and it’s important to understand that under this method revenue does not always equal cash in, and incurred expenses do not equal cash out. Therefore, don’t make the mistake to just look at the income statement and the balance sheet. Focus on the Cash Flow Statement as well because it will show you where the company makes and spends its money. Course Length: 13:25 minutes Source: Leila Gharani

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