With the statement of cash flows:
A) cash payments are considered positive amounts.
B) each category of cash flows either increases or decreases cash.
C) operating activities must increase the company's cash balance.
D) the beginning cash balance is reconciled to the ending balance of retained earnings.

Question

Quizplus · Accepted Answer

Each category of cash flows in the statement of cash flows either increases or decreases cash. Cash payments are not necessarily considered positive amounts as they can represent decreases in cash. Operating activities do not necessarily have to increase the company's cash balance, as there may be cash outflows from operating activities such as payments to suppliers or employees. The beginning cash balance is not reconciled to the ending balance of retained earnings in the statement of cash flows.

With the Statement of Cash Flows