U.S.GAAP requires that the statement of cash flows explain the changes in the firm's
A)cash and cash equivalents during the accounting period.
B)resources and obligations during the accounting period.
C)components of income from operations during the accounting period.
D)accounts receivable and accounts payable during the accounting period.
E)All of the above are required.

Question

Quizplus · Accepted Answer

The statement of cash flows under U.S. GAAP is required to explain the changes in cash and cash equivalents during the accounting period. It presents the sources and uses of cash, including operating, investing, and financing activities, to provide information on the firm's ability to generate cash, meet its obligations, and invest in new opportunities. While U.S. GAAP requires other financial statements to disclose information on the firm's resources, obligations, income, accounts receivable, and accounts payable, these are not the focus of the statement of cash flows.

USGAAP Requires That the Statement of Cash Flows Explain the Changes