Investors and creditors are interested in the probability that their original investment or loan will eventually be returned,and that they will receive a reasonable return while their funds are invested or borrowed.These expectations are collectively
A)Expected profitability.
B)The objectives of financial reporting.
C)Cash flow prospects.
D)Financial position.

Question

Quizplus · Accepted Answer

Cash flow prospects are the expectations of investors and creditors regarding the return of their investment or loan, as well as the potential for receiving a reasonable return while their funds are invested or borrowed. Financial reports provide information on the cash flow prospects of a company, which is essential for informed decision-making by investors and creditors. While expected profitability and financial position are important considerations for investors and creditors, cash flow prospects are more directly tied to the return of their investment or loan. The objectives of financial reporting are to provide information that is useful in making business decisions, but they do not specifically address the expectations of investors and creditors.

Investors and Creditors Are Interested in the Probability That Their