are important because the financial health of a firm depends on the firm being able to generate sufficient cash to pay its creditors, employees, suppliers, and owners.
A)cash sales
B)cash flows
C)cash profits
D)net profits

Question

Quizplus · Accepted Answer

Cash flows are the cash inflows and outflows in a business, which are crucial for the financial health of a firm. It shows the firm's ability to generate cash to meet its obligations and invest in its growth. Cash flows include cash from operations, investing, and financing activities, and it is essential for a company to have positive cash flow to sustain its operations and pay its creditors, employees, suppliers, and owners. Cash sales, cash profits, and net profits are also important, but they do not provide a complete picture of a firm's financial health as they do not consider cash inflows and outflows.

Are Important Because the Financial Health of a Firm Depends