The statement of cash flows
A)is prepared instead of an income statement under ASPE.
B)is used to assess a company's ability to generate cash and the needs of the company in using the cash flows.
C)is prepared from a comparative income statement.
D)reports earnings per share figures on a cash basis in the body of the statement.

Question

Quizplus · Accepted Answer

The statement of cash flows shows how a company generated and used cash during a specific period of time. Its main purpose is to assess a company's ability to generate cash and the needs of the company in using the cash flows. It is prepared separately from the income statement and does not report earnings per share figures on a cash basis in its body.

The Statement of Cash Flows