A statement of cash flows allows a financial analyst to determine
A) whether a cash dividend is affordable.
B) how increases in asset accounts have been financed.
C) whether long-term assets are being financed with long-term or short-term financing.
D) all of these.

Question

Quizplus · Accepted Answer

A statement of cash flows provides information on a company's cash inflows and outflows, which can be used to determine whether a cash dividend is affordable, how increases in asset accounts have been financed, and whether long-term assets are being financed with long-term or short-term financing. Therefore, all of these options are correct.

A Statement of Cash Flows Allows a Financial Analyst to Determine