The primary purpose of the statement of cash flows is to
A)provide information about the investing and financing activities during a period.
B)prove that revenues exceed expenses if there is a profit.
C)provide information about cash receipts and cash payments during a period.
D)report to Canada Revenue Agency.

Question

Quizplus · Accepted Answer

The primary purpose of the statement of cash flows is to provide information about cash receipts and cash payments during a period. It shows the sources and uses of cash, and helps investors and analysts evaluate a company's liquidity and ability to pay debts. Options A, B and D are not accurate statements about the purpose of the statement of cash flows.

The Primary Purpose of the Statement of Cash Flows Is