A Statement of Cash Flows Is Generated to Show

question 130

Multiple Choice

A statement of cash flows is generated to show

• A)the revenues the company has earned.
• B)the expenses the company incurred during the time period.
• C)how profits were generated.
• D)the inflow and outflow of cash during the time period.

---

Definitions:

Fixed Cost

A cost that does not vary with the level of output or sales over a certain period, such as rent or salaries.

Break-even Point

The point at which total costs and total revenue are equal, meaning no profit or loss is made, illustrating the minimum sales volume needed to cover fixed and variable costs.

Sales Mix

Sales mix refers to the proportion of different products or services sold by a company, influencing decisions on pricing, marketing, and production.

Variable Expenses

Costs that vary in direct proportion to changes in an organization's activity level or volume of output.