Analysts use the statement of cash flows to measure ________.
A)the ability of a company to repay loans
B)the ability of a company to expand by investing in new equipment
C)the amount of excess cash generated by operating activities
D)all of these

Question

Quizplus · Accepted Answer

The statement of cash flows provides information about a company's cash inflows and outflows from operating, investing, and financing activities. Analysts can use this information to measure the company's ability to repay loans (financing activities), its ability to expand by investing in new equipment (investing activities), and the amount of excess cash generated by operating activities. Therefore, all of these options are valid measurements that analysts can use by analyzing the statement of cash flows.

Analysts Use the Statement of Cash Flows to Measure ________