What are the three activities according to which a statement of cash flows is organized?
A) Operating, selling, and investing
B) Financing, buying, selling
C) Investing, financing, and expensing
D) Processing, operating, receiving
E) Operating, investing, financing

Question

Quizplus · Accepted Answer

The statement of cash flows is organized into three activities: operating, investing, and financing. The operating activities include cash transactions related to revenue and expense activities. The investing activities include cash transactions related to investments in long-term assets, such as property, plant, and equipment. The financing activities include cash transactions related to financing the business, such as issuing or repaying debt, paying dividends, and issuing or buying back stock. Option E includes the correct activities.

What Are the Three Activities According to Which a Statement