Which of the following is not correct about the statement of cash flows?
A)Paying dividends to investors creates a cash outflow from financing activities.
B)A purchase of equipment is classified as a cash outflow from investing activities.
C)A company with a net loss on the income statement will always have a net cash outflow from operating activities.

Question

Quizplus · Accepted Answer

A company with a net loss on the income statement may still have a net cash inflow from operating activities if non-cash expenses (such as depreciation and amortization) are added back to the net loss. Thus, statement C is incorrect.

Which of the Following Is Not Correct About the Statement