Importance of Interpreting Cash Flow Statements
Not what you're looking for?
What may be gained by interpreting a cash flow statement?
Please include references.
Purchase this Solution
Solution Summary
This solution highlights the reasons why a perspective investor would want to interpret an organization's cash flow statement. Additionally, this solution includes two reference sources.
Solution Preview
What may be gained by interpreting a cash flow statement.
A cash flow statement is one of the types of financial statements of a company. Cash flow statements show the cash flow from operations, the inflow and outflow of cash, and the solvent position of the company.
Cash flow statements include operating activities (converting the items in the income statement into items on the basis of cash), investing activities (purchase and sale of long term investments and the fixed assets), financing activities (issue and purchase of shares and payment of dividend) and the amount of income tax paid and the interest paid.
Cash flow statements show the liquidity position of the company. If a cash flow statement shows negative cash flows, it means that ...
Purchase this Solution
Free BrainMass Quizzes
Understanding Management
This quiz will help you understand the dimensions of employee diversity as well as how to manage a culturally diverse workforce.
Organizational Behavior (OB)
The organizational behavior (OB) quiz will help you better understand organizational behavior through the lens of managers including workforce diversity.
Learning Lean
This quiz will help you understand the basic concepts of Lean.
Team Development Strategies
This quiz will assess your knowledge of team-building processes, learning styles, and leadership methods. Team development is essential to creating and maintaining high performing teams.
Understanding the Accounting Equation
These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.