One Can Prepare the Statement of Cash Flows

question 77

Multiple Choice

One can prepare the statement of cash flows

• A)by examining every transaction affecting the cash account, and classifying each one as an operating activity, investing activity, or financing activity.
• B)using the T-account work sheet after the income statement and balance sheet have been prepared.
• C)using the T-account work sheet before the income statement and balance sheet have been prepared.
• D)by using both options a and b.
• E)by none of the above.

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Definitions:

Journal Entries

Entries made into an accounting ledger to document financial transactions, ensuring the debits equal the credits.

Voting Shares

Equity securities that grant the holder the right to vote on company matters, such as board elections and major corporate decisions.

Net Income

The net income of a business once all costs and taxes are subtracted from its total revenues.

Fair Value Through Other Comprehensive Income

A financial accounting method where certain assets are revalued periodically and changes are recorded in other comprehensive income.