A statement of cash flows should help investors and creditors assess the entity's ability to generate future income.

Name: A statement of cash flows should help investors and creditors assess the entity's ability to generate future income.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

A statement of cash flows is primarily used to assess an entity's liquidity, solvency, and financial flexibility by showing cash inflows and outflows, rather than directly assessing future income generation.

A Statement of Cash Flows Should Help Investors and Creditors