The statement of cash flows is least likely to help external users assess
A) a company's ability to generate positive future cash flows.
B) the amount of a company's future accrual-based sales revenue.
C) a company's ability to meet its obligations and pay dividends.
D) a company's need for external financing.

Question

Quizplus · Accepted Answer

The statement of cash flows provides information about a company's cash receipts and cash payments during a period, which helps in assessing its ability to generate future cash flows, meet obligations, and its need for external financing. It does not directly provide information about future accrual-based sales revenue, which is more closely related to the income statement and balance sheet projections.

The Statement of Cash Flows Is Least Likely to Help