Which Statement Is not Correct

question 38

Multiple Choice

Which statement is not correct?

• A)Information in the cash flow statement is useful in assessing the ability of an entity to pay its debts as they fall due
• B)A comparison of the cash flow statement and the income statement can indicate to what extent the profit is represented by cash inflows
• C)The cash flow statement classifies cash flows into operating investing and financing groupings
• D)Operating activities is concerned with activities involving the sales and purchases of fixed assets.

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Definitions:

Marginal Cost

The additional cost incurred in producing one more unit of a good or service, crucial for making production and pricing decisions.

Fixed Cost

Fixed cost is a business expense that remains constant regardless of changes in the level of production or sales volumes, such as rent or salaries.

Lawn-mowing

The act of cutting the grass of a lawn to maintain a specified height and neat appearance.

Variable Costs

Expenses that change in proportion to the activity or volume of goods or services produced.