The Primary Purpose of the Statement of Cash Flows Is

question 28

True/False

The primary purpose of the statement of cash flows is to provide information about the cash receipts and cash payments of a business for a specific period of time.

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Definitions:

Adjusting Entry

A financial transaction documented at the close of an accounting cycle to apportion income and costs to the suitable period.

Depreciation

The process of allocating the cost of a tangible or physical asset over its useful life, reflecting wear and tear.

Adjustments

Corrections or changes made to the book balances of accounts to reflect more accurate values in financial accounting.

Payroll

The total amount of wages, salaries, and other earnings that a company pays to its employees.