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Which of the following describes the operating activities section of a cash flow statement?
A) It provides information about how operations have been financed.
B) It provides information pertaining to dividend payments to stockholders.
C) It provides information with respect to a company's ability to generate cash flows that are directly related to earning income.
D) It provides the net increase or decrease in cash during the period.
Operating Activities
The portion of a company's business activities that are related to its main operations, such as selling products or offering services.
Cash Flow Statement
A report detailing the impact of variations in balance sheet figures and income on cash and cash equivalents, segmented into operations, investments, and finance-related actions.
Dividend Payments
Dividend payments are the distribution of a portion of a company's earnings, decided by the board of directors, to its shareholders.
- Realize the contribution of financial statements, including cash flow and income statements, to the assessment of a company's economic health.
- Realize how company operations, investments, and financing activities influence cash flows.
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Learning Objectives
- Realize the contribution of financial statements, including cash flow and income statements, to the assessment of a company's economic health.
- Realize how company operations, investments, and financing activities influence cash flows.
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