According to the Statement of Cash Flows, an Increase in Inventory

question 91

Multiple Choice

According to the statement of cash flows, an increase in inventory will ________ the cash flow from ________ activities.

• A) increase; operating
• B) decrease; financing
• C) decrease; operating
• D) increase; financing
• E) increase; investment

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Definitions:

Board of Directors

A group of individuals elected to represent shareholders and govern the corporation's affairs, making key decisions on its behalf.

Prior Period Adjustment

A correction of errors in previously issued financial statements to reflect accurate past financial information.

Retained Earnings

Profits that a company has chosen to reinvest in the business rather than distribute to shareholders as dividends.

Earnings Per Share

A financial ratio representing the portion of a company's profit allocated to each outstanding share of common stock.