The information in a statement of cash flows will not help investors to assess the entity's ability to
A) generate future cash flows.
B) obtain favorable borrowing terms at a bank.
C) pay dividends.
D) pay its obligations when they become due.

Question

Quizplus · Accepted Answer

The statement of cash flows provides information about the entity's cash flows from operating, investing, and financing activities. It helps investors to assess the entity's ability to generate future cash flows, pay dividends, and pay its obligations when they become due. However, it does not provide information about the entity's ability to obtain favorable borrowing terms at a bank, which is more related to the entity's creditworthiness and borrowing history.

The Information in a Statement of Cash Flows Will Not