Questions
BU.210.650.51.FA25 Final Exam- Requires Respondus LockDown Browser
Single choice
Why is the operating activities section of the statement of cash flows often believed to be the most important part of the statement?
Options
A.None of the suggested answers because the operating section is not often believed to be the most important part of the statement.
B.Because shows the net increase or decrease in cash during the period.
C.Because it shows the dividends that have been paid to stockholders.
D.Because it gives the most information about how operations have been financed.
E.Because it indicates a company's ability to generate cash from sales to meet current cash payments for goods or services.
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Step-by-Step Analysis
When evaluating why the operating activities section of the statement of cash flows is often considered the most important, we need to assess what each option asserts and how it aligns with the purpose of that section.
Option 1: 'None of the suggested answers because the operating section is not often believed to be the most important part of the statement.' This is incorrect because many accounting texts and practitioners do view the operating act......Login to view full explanationLog in for full answers
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