Negative Cash Flow from Investing Activities on the Statement of Cash

question 134

Multiple Choice

Negative cash flow from investing activities on the statement of cash flows most likely indicates a company is ________.

• A)borrowing more than it is paying off
• B)buying more long-term assets than it is selling
• C)paying off more of its debts than it is borrowing
• D)in poor financial health

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Definitions:

Accounts Receivable

The amount of money owed to a business by its customers for products or services that have been delivered but not yet paid for.

Liability

A financial obligation owed by an individual or entity to another party, typically classified as current or long-term.

Statement Order

The sequence in which financial statements are prepared and presented, typically starting with the income statement.

Income Statement

A financial document that provides an overview of a company's revenues, expenses, and profits over a specific period of time.