Cash flow from financing activities is the most important category on the statement of cash flows because it is considered the best way to evaluate future income.

Question

Quizplus · Accepted Answer

Cash flow from financing activities shows the inflow and outflow of cash related to the company's financing activities, such as issuing or repurchasing stocks, issuing or repaying long-term debt, and paying dividends. While it is an important category on the statement of cash flows, it is not considered the best way to evaluate future income. Instead, the net income or earnings of the company is a more reliable indicator of future income.

Cash Flow from Financing Activities Is the Most Important Category