Which of the Following Statements Accurately Describes the Statement of Cash

question 36

Multiple Choice

Which of the following statements accurately describes the statement of cash flows?

• A)It shows the relative proportion of debt and assets.
• B)It shows the link between accrual based income and the cash reported on the balance sheet.
• C)It indicates when long-term debt will mature.
• D)It shows the link between book income and earnings per share.

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Definitions:

Enforce

To compel observance of or compliance with a law, rule, or obligation.

Negotiable Promissory Note

A financial document that contains a written promise to pay a specified sum of money to a named person or bearer under certain terms.

Worthless Securities

Financial instruments that have lost all monetary value, often resulting in a total loss for the holder.

Holder in Due Course

A legal term for a person who has acquired a negotiable instrument in good faith and for value, and thus has certain rights to it free from many defenses.