When a company is purchasing long-term assets, this is a sign of growth. This information can be obtained by examining:
A) the equity section of the balance sheet.
B) the revenues section of the income statement.
C) the investing cash flows section of the statement of cash flows.
D) the net income section of the statement of retained earnings.

Question

Quizplus · Accepted Answer

The investing cash flows section of the statement of cash flows shows the cash spent on the purchase of long-term assets, which is an indication of the company's growth strategy. A and D are not relevant to this information, while B only shows revenue and does not necessarily indicate growth through the purchase of long-term assets.

When a Company Is Purchasing Long-Term Assets, This Is a Sign