The statement of cash flows is useful to the analyst because__________. Select one: a. focusing on net income can be misleading if a company has a healthy profit, but cannot translate the profit into cash b. the statement of cash flows reveals why a company was able to generate a profit c. it is the only source in statement of comprehensive income for learning about cash generation d. focusing on net income is truthful if a company has a healthy profit and it

Auditing: A Risk Based-Approach (MindTap Course List)
11th Edition
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Chapter10: Auditing Cash, Marketable Securities, And Complex Financial Instruments
Section: Chapter Questions
Problem 19CYBK
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The statement of cash flows is useful to the analyst because__________.
Select one:
a. focusing on net income can be misleading if a company has a healthy profit, but cannot translate the profit into cash
b. the statement of cash flows reveals why a company was able to generate a profit
c. it is the only source in statement of comprehensive income for learning about cash generation
d. focusing on net income is truthful if a company has a healthy profit and it can translate the profit into cash
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