The _____ shows the relation between net income and cash flows from operations, and changes in assets and liabilities that involve cash flows.
A)balance sheet
B)statement of cash flows
C)income statement
D)funds flow statement
E)cash receipts and cash disbursement statement

Question

Quizplus · Accepted Answer

The statement of cash flows shows the changes in cash and cash equivalents for a period and categorizes those changes as arising from operating, investing, and financing activities. It also reconciles the net income figure from the income statement with the cash flows from operations by adjusting for any non-cash items and changes in working capital accounts such as receivables, payables, and inventory. The balance sheet shows the financial position of a company at a point in time, while the income statement shows the financial performance over a period of time. The funds flow statement and the cash receipts and cash disbursement statement are not commonly used financial statements.

The _____ Shows the Relation Between Net Income and Cash