The total of the cash flows from operating,investing,and financing activities equals the net increase or decrease in cash for the period.

Question

Quizplus · Accepted Answer

This is the fundamental principle of the statement of cash flows. The total of the cash flows from operating, investing, and financing activities should equal the net increase or decrease in cash for the period. This ensures that all of a company's cash inflows and outflows are accounted for and reconciled with the change in its cash balance.

The Total of the Cash Flows from Operating,investing,and Financing Activities