The statement of cash flows informs users about how much of the earnings were kept and reinvested in the company.

Question

Quizplus · Accepted Answer

The statement of cash flows provides information about the sources and uses of cash during a specific accounting period, including operating, investing, and financing activities. It does not directly provide information about how much of the earnings were kept and reinvested in the company. However, by analyzing the statement of cash flows along with the income statement and balance sheet, users can make inferences about the company's earnings retention and reinvestment practices.

The Statement of Cash Flows Informs Users About How Much