Operating activities refer to the core functions of a business that generate revenue. This includes tasks like selling products or services, managing inventory, and handling customer transactions. Essentially, it's all about the day-to-day operations that keep the business running and profitable. These activities are crucial for a company's financial health, as they directly impact cash flow. For example, when a company like Apple sells an iPhone, the money received from that sale is considered cash generated from operating activities. Tracking these activities helps businesses understand their performance and make informed decisions for future growth.