Examining a Company's Statement of Cash Flows Helps in Evaluating

question 13

True/False

Examining a company's statement of cash flows helps in evaluating a company's liquidity,but does not predict future cash flows.

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Definitions:

Operating Cash Flow

Cash generated by a company’s core business operations.

Cash Flow

Cash Flow is the net amount of cash and cash-equivalents being transferred into and out of a business, affecting its liquidity.

Assets

Resources owned by a company, expected to deliver future economic benefits.

Capital Gains

Profit realized from the sale of assets like stocks, bonds, or real estate when the selling price exceeds the purchasing price.