Financial statement users focus a great deal of attention on cash flows related to operating activities, because, over the long run, a business must generate positive cash flows from its profit-oriented activities to be successful.

Question

Quizplus · Accepted Answer

This statement is true. Cash flows from operating activities are a key indicator of a business's ability to generate cash from its core operations, which is necessary for long-term success.

Financial Statement Users Focus a Great Deal of Attention on Cash