The Order of Presentation of Activities on the Statement of Cash

question 75

Multiple Choice

The order of presentation of activities on the statement of cash flows is

• A) operating, investing, financing.
• B) operating, financing, investing.
• C) financing, operating, investing.
• D) financing, investing, operating.

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Definitions:

Accounts Payable

Money owed by a business to its suppliers shown as a liability on the company's balance sheet.

Inventory Increase

A situation where a company experiences a rise in the level of goods and materials on hand, reflecting either a buildup in anticipation of higher sales or slower sales than expected.

Depreciation Tax Shield

The tax saving achieved by a company from deducting depreciation expenses on its taxable income.

Depreciation

The allocation of the cost of an asset over its useful life, reflecting the asset's consumption, wear and tear, or obsolescence.