When an annual statement of cash flows is prepared the sum of the three major components add up to:

Question

Quizplus · Accepted Answer

The sum of the three major components, which are cash flows from operating activities, investing activities, and financing activities, should equal the change in the cash at bank account balance over the year, which is reported on the cash flow statement as the net increase or decrease in cash and cash equivalents. The other options, such as profit for the period, ending working capital, or ending cash at bank account balance, may be affected by non-cash items or other factors not reflected in the cash flow statement.

When an Annual Statement of Cash Flows Is Prepared the Sum