Why is “cash received from sale of company building” considered Operating Cash Flow?
January 9, 2011 by Cash Flow Tips
Filed under More Cash Flow Answers
Can you answer cory’s question about Cash Flow?:
My financial statements book (Scheweser’s chartered financial analyst guide) says that profit on sale of building is NOT considered cash flow from operations, but “cash received from sale of company building” is.
My financial statements book (Scheweser’s chartered financial analyst guide) says that profit on sale of building is NOT considered cash flow from operations, but “cash received from sale of company building” is.
And then it goes on to say that “cash received from sale of company building” is considered investing cash flow.
Which one of these is right?
Financial Statement Analysis Software
![\"Cash](\"/images/tips.jpg\")
![\"Cash](\"/images/articles.jpg\")
Cash Flow Feedback: The sale of long-term assets used in a business is classified as cash flow from investing activities. This would include the sale of a company building. Of course there are always exceptions to every rule. For example, if a real estate investor was in the business of buying and selling buildings, this would be an operating activity common to that type of business and would therefore be classified as cash flow from operations.
You might be dealing with a misprint.