Question

Balance sheet information is useful for all of the following except to

a. compute rates of return
b. analyze cash inflows and outflows for the period
c. evaluate capital structure
d. assess future cash flows

Answer 1

The balance sheet is useful for analyzing cash inflows and outflows, evaluating capital structure, and assessing future cash flows.

Step-by-step explanation:

The balance sheet is a financial statement that shows a company's financial position at a specific point in time. It lists the company's assets, liabilities, and shareholders' equity. It is a useful tool for analyzing cash inflows and outflows for the period, evaluating the capital structure, and assessing future cash flows. However, it is not directly used to compute rates of return, as that information is typically found in the income statement and statement of cash flows.