How to calculate operating cash flow?

[niyati]

I’m learning financial analysis and came across the term Operating Cash Flow (OCF). I know it's related to how much cash a business generates from its operations, but I’m confused about how to actually calculate it.

 

[danisjohn]

To calculate operating cash flow, start with net income, then add non-cash expenses like depreciation and amortization. Adjust for changes in working capital (accounts receivable, inventory, accounts payable). The formula is:
Operating Cash Flow = Net Income + Non-Cash Expenses + Changes in Working Capital.
Use cash flow statements for accuracy.