Cash Flow Statement

Question 1

What is the cash flow statement?

Answer 1

It provides a information on a companies liquidity and solvency

Question 2

What is solvency?

Answer 2

The possession of assets in excess of liabilities; ability to pay ones debt

Question 3

What does the cash flow statement include?

Answer 3

Cash from operations, cash from investing activities and cash from financing activities

Question 4

What is cash from operations?

Answer 4

Cash that is obtained by a companies primary means of cash flow (cash from sale, rent payments, salary payments, etc.)

Question 5

What is cash from investing activities?

Answer 5

The focus is on acquiring or getting rid of long term assets

Question 6

True or False: Cash from investing activities show the outflow of cash on an investment being made, as well as the inflow of cash when assets are sold

Answer 6

True

Question 7

What is cash from financial activities?

Answer 7

This shows the inflow and outflow of cash due to equity capital or borrowings

Question 8

True or False: Cash from financing activities also tracks the cash flow between the company, its owners, creditors and lenders including shareholders?

Answer 8

True