The Three Activities of the Cash Flow Statement in Order

question 98

Multiple Choice

The three activities of the cash flow statement in order of importance,from most important to least important,are:

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

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Definitions:

Contributed Capital

The total value of the cash and other assets received by a company from its shareholders in exchange for stock, also known as paid-in capital.

Preferred Stock

A class of ownership in a corporation with a higher claim on assets and earnings than common stock, often paying fixed dividends.

Callable Preferred Stock

A type of preferred stock that gives the issuer the right to redeem the stock at a predetermined price after a certain date.

Convertible Preferred Stock

A type of preferred stock that gives the holder the option to convert it into a specified number of common stock shares, usually at any time after a predetermined date.