Discuss how the statement of cash flows is used by investors.
If you were an investor reviewing a statement of cash flows, what section would interest you most? Why?
Now discuss the circumstances in which other sections of the statement might be important to an investor.
The statement of cash flows is used by investors to see the sources of cash (operating, investing, and financing) of a firm and the targets of cash outflows. In other words, investors can see precisely from where and to whom cash payments are made as groups.
As an investor, the most important section of the statement of cash flows is the operating section. While it is true that ...
The solution discusses how the statement of cash flows is used by investors, what section of it is the most important to investors, and what other sections are used by them.