The Primary Purpose of the Statement of Cash Flows Is

question 47

True/False

The primary purpose of the statement of cash flows is to provide information about a company's investing and financing activities during an accounting period.

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Definitions:

Statement of Cash Flows

A financial report that shows the cash generated and used by a company during a specific period, classified into operating, investing, and financing activities.

Operating Activities

Activities that are directly related to the primary operations of a company, such as manufacturing, distributing, marketing, and selling a product or service.

Retained Earnings

The amount of net income left over for the business after it has paid out dividends to its shareholders.