The statement of cash flows is divided into three sections: ________.
A) operating leverage, investment leverage, and financing leverage
B) cash inflows, cash outflows, and cash flow cycle
C) cash-in-use, cash-in-resource, and cash conversion cycle
D) operating activity, investment activity, and financing activity

Question

Quizplus · Accepted Answer

The statement of cash flows is divided into three sections based on the activities that generate or use cash: operating activity, investment activity, and financing activity. Operating activity includes cash flows from day-to-day operations, investment activity includes cash flows from investment in long-term assets, and financing activity includes cash flows from borrowing or issuing equity.

The Statement of Cash Flows Is Divided into Three Sections