The Primary Purpose of the Statement of Cash flOws Is

question 133

Multiple Choice

The primary purpose of the statement of cash flows is to report which of the following?

• A) profit earned and dividends paid during the period.
• B) all inflows and outflows of cash during the period.
• C) assets owned and claims against those assets at the end of the period.
• D) liability changes made by the financial department of the company during the period.

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Definitions:

Utility-maximizing

Refers to the economic principle where individuals or households attempt to get the highest level of satisfaction from their resources.

Income

The money received, especially on a regular basis, for work or through investments.

Marginal Utility

The increased enjoyment or value one gets from the consumption of an extra unit of a good or service.

Marginal Utility

The added satisfaction or usefulness obtained from using one more unit of a product or service.