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

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. This information helps analysts and investors evaluate a company's ability to generate cash and its liquidity position, which in turn can be used to predict its ability to pay debts and dividends. Choice A is more closely related to the income statement, while choice B is related to the balance sheet. Choice C is also related to the balance sheet and financial leverage.

One of the Purposes of the Statement of Cash Flows