Question

Give two differences between net profit and cash from operations.

Answer 1

Sr. No.	Basis of Difference	Net Profit	Cash from Operations
1.	Basis	It is calculated on an accrual basis.	It is calculated on a cash basis.
2.	Inclusion of Non-cash Items	It includes non-cash and non-operating items like depreciation and profit/loss on the sale of assets.	It excludes non-cash and non-operating items to find actual cash from operations.