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11) Which of the following sections of the statement of cash flows includes activities that increase and decrease long-term liabilities and stockholders' equity? A) the investing activities section B) the financing activities section C) the operating activities section D) the non-cash investing and financing section

Sagot :

Lanuel

Answer:

A) the investing activities section

Explanation:

A financial statement is a written report that quantitatively describes a firm's financial health. Under the financial statements is a cash-flow statement, which is used to record the cash inflow and cash equivalents leaving a business firm.

Cash flow statement, also known as the statement of cash flows, contains financial information about operating, financial and investing activities.

1. Operating cash flow: all cash generated from the business activities of an organization.

2. Financing cash flow: all payments made by an organization and profits from issuance of debts and equity.

3. Investing cash flow: costs associated with purchasing of capital assets and investments of cash resources in other businesses.

Generally, investing activities comprises of purchasing physical assets, investing in securities and the sale of assets or securities associated with the company.

Hence, the investing activities section of the statement of cash flows includes activities that increase and decrease long-term liabilities and stockholders' equity in the business they have invested their money in.

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