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Business Activities That Either Generate or Use Cash Are Classified

question 113

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Business activities that either generate or use cash are classified as operating,investing,or financing activities on the statement of cash flows.


Definitions:

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within a year or within the business's operating cycle.

Current Liabilities

Obligations or debts that a company must pay within a year.

Inventory

The goods and materials a business holds for the ultimate goal of resale or repair.

Benchmarking

The act of measuring a company's operations and performance indicators against the industry's highest standards or optimal practices.

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