In the statement of cash flows, net cash flows from operating activities plus net cash flows from investing activities plus net cash flows from financing activities for the period equal:Group of answer choicesthe cash balance at the end of the period.total net increase or decrease in cash held for the period.operating profit.the cash balance at the beginning of the period.
Question
In the statement of cash flows, net cash flows from operating activities plus net cash flows from investing activities plus net cash flows from financing activities for the period equal:Group of answer choicesthe cash balance at the end of the period.total net increase or decrease in cash held for the period.operating profit.the cash balance at the beginning of the period.
Solution
The statement of cash flows provides information about a company's cash receipts and cash payments during an accounting period. It shows how changes in balance sheet accounts and income affect cash and cash equivalents, and breaks the analysis down according to operating, investing, and financing activities.
When you add up the net cash flows from operating activities, investing activities, and financing activities for a given period, you get the total net increase or decrease in cash for that period.
This change in cash, when added to the cash balance at the beginning of the period, equals the cash balance at the end of the period. However, the question asks what the sum of the three activities equals, not what it contributes to. Therefore, the correct answer is "total net increase or decrease in cash held for the period".
Similar Questions
Net Cash Flow to the firm is also considered cash flow coming from _______________.a.Operating activitiesb.Invesying activitiesc.Equity activitiesd.Financing activities
The net cash flows from operating, investing, and financing activities will equal:Multiple ChoiceThe change in stockholders’ equity for the year.The ending balance of cash this year.Net income minus dividends for the year.The change in cash reported in the balance sheet from this year versus last year.
The Statement of cash flows helps management, investors, creditors and other interested parties evaluate the following about the entity (choose all that apply):Group of answer choicesCash investing and financing transactions for the periodExplains the difference between profit and net cash provided (used) by operating activitiesAbility to pay share dividends and meet obligationsAbility to generate future cash flows
The statement of cash flows reports:Multiple ChoiceEquity, net income, and dividends.Assets, liabilities, and equity.Cash receipts (inflows) and cash payments (outflows) for an accounting period.Changes in equity.Revenues, gains, expenses, and losses.
Cash flow from operations examines the:Group of answer choicesimpact of selling or acquiring current and fixed assetsrevenues, interest and dividends from investments held by the business.leasing, licensing, and rental agreements of the operations conducted by the business.increase or decrease in the short- and long-term debt position of the firm. PreviousNext
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