One of the purposes of the statement of cash flows is to ________.

Question

Quizplus · Accepted Answer

The statement of cash flows helps to predict a company's ability to pay debts and dividends by analyzing the sources and uses of cash during a given period. It summarizes the inflow and outflow of cash and provides insights into the company's liquidity, operating activities, investment activities, and financing activities. Therefore, option D is the correct choice. Option A and B are related to the balance sheet and income statement, respectively. Option C is related to the analysis of financial statements, but it does not directly involve the statement of cash flows.

One of the Purposes of the Statement of Cash Flows