The Primary Purpose of the Statement of Cash Flows Is

question 20

Multiple Choice

The primary purpose of the statement of cash flows is to provide information about

• A)the financial position of the company.
• B)the profitability of the company.
• C)the investing and financing activities of the company.
• D)the cash inflows and outflows of the company.

Recognize the circumstances under which clients might conduct their own legal research.

Appreciate the benefits of maintaining an ongoing relationship with a legal professional.

Understand the concepts and purposes of retainers, disbursements, and managing financial discrepancies in legal services.

Recognize the ethical standards and professional responsibilities expected of legal professionals.

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Definitions:

Option Agreement

A share transfer restriction granting a corporation or its shareholders an option to buy a selling shareholder’s shares at a price determined by the agreement.

Buy-and-Sell Agreement

a legally binding agreement between co-owners that outlines what will happen to an owner’s share of the business if they depart the business due to death or any other reason.

De Facto Corporation

A business that operates as if it were a corporation although it has not completed the formalities required for legal incorporation.

Organization Meeting

An initial meeting held to complete the formation of an entity, where bylaws are adopted, officers elected, and other organizational matters decided.