The explanation of why the net income differs from the change in cash balance for the period is explained in the ________.

Question

Quizplus · Accepted Answer

The statement of cash flows explains how the change in cash balance occurred during the period, while the income statement only shows the net income earned. The balance sheet and statement of retained earnings may provide some insight into changes in assets and owner's equity, respectively, but they do not provide the detailed analysis of cash flows that the statement of cash flows does.

The Explanation of Why the Net Income Differs from the Change