Cash Flow Statement Example and How 360 Accounting Pro Inc Can Help You Use It Right

12-05-25

Managing cash is one of the most critical aspects of running a successful business. Whether you are a freelancer, small business owner, or managing a growing company, the cash flow statement gives you a clear picture of your business’s liquidity and operational health.

In this blog, we will walk through a realistic cash flow statement example, explain each section, and show you how 360 Accounting Pro Inc helps businesses create, manage, and analyze their cash flow for growth and stability.

What Is a Cash Flow Statement?

A cash flow statement is one of the three core financial statements, alongside the balance sheet and profit and loss statement. It shows how cash moves in and out of a business over a specific period. This includes cash received from operations, investments, and financing — and cash paid for expenses, equipment, and debt.

Unlike the income statement, which uses accrual accounting and may show revenue before money is collected, the cash flow statement focuses on real money movement — what came in and what went out.

Cash Flow Statement Sections

A standard cash flow statement is divided into three main sections:

Cash Flow from Operating Activities – cash from your core business (e.g., revenue, expenses, accounts receivable, inventory).
Cash Flow from Investing Activities – buying or selling long-term assets (e.g., equipment, property).
Cash Flow from Financing Activities – loans, repayments, and capital from investors.

Cash Flow Statement Example

Here is a simple example for a fictional small business, Diana’s Goat Grooming, for the month ending January 31:

Cash Flow from Operating Activities

Net Income: $60,000
Depreciation (non-cash expense added back): $20,000
Increase in Accounts Payable: $10,000
Increase in Accounts Receivable: ($20,000)
Increase in Inventory: ($30,000)
Net Cash from Operating Activities: $40,000

Cash Flow from Investing Activities

Purchase of Equipment: ($5,000)
Net Cash from Investing Activities: ($5,000)

Cash Flow from Financing Activities

No activity this period
Net Cash from Financing Activities: $0

Net Increase in Cash for the Month: $35,000

This example shows how cash is generated from operations but used to purchase new equipment — with no financing activity in the period. The final cash position improves by $35,000, showing healthy business performance and available liquidity.

Why the Cash Flow Statement Is Important

Tracks Liquidity: Ensures your business has enough cash to pay bills and invest in growth.
Supports Decision-Making: Helps you plan hiring, expansion, or reducing costs.
Prepares for Taxes: Tracks accurate numbers for estimated payments or end-of-year filing.
Prevents Surprises: Keeps you ahead of upcoming financial challenges.
Impresses Investors and Lenders: A solid cash flow statement builds credibility and confidence.

How 360 Accounting Pro Inc Helps You Master Cash Flow

At 360 Accounting Pro Inc, we go beyond just preparing reports. We offer end-to-end accounting and bookkeeping services, including building, managing, and analyzing your cash flow statement.

Here’s how we help:

1. Customized Cash Flow Statements

We prepare detailed, easy-to-understand cash flow statements tailored to your business type and goals — whether you are a service provider, eCommerce seller, or contractor.

2. Monthly Cash Flow Reviews

We meet with clients monthly or quarterly to review cash flow performance, helping you identify cash gaps, funding needs, or areas to save money.

3. Cash Flow Forecasting

Using historical data and business goals, we project your future cash flow so you can confidently make plans for growth, hiring, or investment.

4. Real-Time Software Integration

We integrate with platforms like QuickBooks Online, Xero, or Zoho Books to track your cash movements and update your cash flow statement in real-time.

5. Financial Strategy and Planning

As your outsourced accounting partner, we help use your cash flow data for budgeting, tax planning, loan applications, and investor reporting.

Final Thoughts

Understanding your cash flow is one of the smartest things you can do as a business owner. It tells you if you’re making enough to cover your costs, if you can afford to invest, and where your money is going each month.

Whether you're building your first cash flow statement or trying to improve profitability, 360 Accounting Pro Inc is here to help. Our team of experts brings clarity, structure, and strategy to your financial operations — so you can grow with confidence.

Contact us today to schedule a free consultation and take control of your cash flow.

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