Question

What is the purpose of a statement of cash flows?

Answer 1

Answer:The purpose of the cash flow statement is to show where an entities cash is being generated.

(cash inflows), and where its cash is being spent (cash outflows), over a specific period of time (usually quarterly and annually). It is important for analyzing the liquidity and long term solvency of a company

Answer 2

Answer: The purpose of the cash flow statement is to show where an entities cash is being generated (cash inflows), and where its cash is being spent (cash outflows), over a specific period of time (usually quarterly and annually). It is important for analyzing the liquidity and long term solvency of a company.