Which Statement Is Correct

question 34

Multiple Choice

Which statement is correct?

• A)Cash flows are grouped by operating,investing and financing activities.
• B)Cash inflows and outflows are netted against each other.
• C)Net interest received or paid can be offset in the cash flow statement.
• D)Income tax paid does not need to be presented separately.

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Definitions:

Cost of Sales

The immediate expenses related to the manufacturing of products sold by a business, encompassing costs for materials and labor.

Cash Receipts

Money received by a business during a particular period, including revenues from sales and other transactions.

Cash Disbursements

Outflows of cash, typically categorized for financial reporting and analysis of a company’s cash outflow activities.

Cash Disbursements

Outflows of cash for expenses, including payments to suppliers, employees, and other creditors.