If an owner wanted to know how money flowed into and out of the company, which financial statement would the owner use?
A) income statement
B) statement of cash flows
C) balance sheet
D) statement of retained earnings

Question

Quizplus · Accepted Answer

The statement of cash flows shows the inflows and outflows of cash for a specific period of time, which allows the owner to understand how money flows into and out of the company. The income statement shows the company's revenues and expenses, while the balance sheet shows assets, liabilities, and equity at a specific point in time. The statement of retained earnings shows changes in the company's retained earnings balance.

If an Owner Wanted to Know How Money Flowed into and Out