The cash flow activities on the cash flow statement are divided into these categories:
A)cash from operations, buying or selling assets and financing the business.
B)payments on trade receivables, payments on trade and other payables and changes in equity.
C)cash from sales, cash from trade receivables and payments on trade and other payables.
D)payment on debt, cash from sales and increases to owner's equity.

Question

Quizplus · Accepted Answer

The cash flow activities on the cash flow statement are commonly categorized into three main categories: Cash from Operations, Cash from Investing, and Cash from Financing. Option A correctly identifies these three categories as cash from operations (which includes the cash received and paid out during the course of normal business operations), buying or selling assets (which includes equipment, property or other fixed assets), and financing the business (which includes obtaining or repaying loans, issuing or buying back shares, and paying dividends). Option B lists specific items that are included in accounts payable and accounts receivable, but do not reflect the main categories of cash flows. Option C includes cash flows that are not commonly recognized in financial reporting, and Option D lists some specific examples of cash flows but doesn't provide a comprehensive overview of the main categories.

The Cash Flow Activities on the Cash Flow Statement Are