💸 Cash Flow Sorter

Lesson: The 3 Cash Flow Engines

Operating (O): Cash directly tied to net income activities—cash from customers, paying inventory suppliers, wages, rent, and taxes.

Investing (I): Cash spent or received from long-term capital assets—buying delivery vans, selling plant equipment, or purchasing securities of other companies.

Financing (F): Cash dealing with creditors and investors—borrowing bank loans, issuing common stock, and paying dividends.

GAAP Trap: Dividends Paid is always Financing (deals with equity owners), whereas Interest Paid is treated as Operating.

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