(a)
Cash Flow Statement:
Cash Flow Statement is a fundamental financial statement that renders valuable information regarding the
The cash flow statement also provides information regarding the net cash change that occurred during a period, classifying the activities into three categories those are cash from operating activities, investing, and financing activities.
In operating activities, cash affected transactions only recorded. In investing activities, investing transactions are recorded and in financial activities involve
To calculate: The
(b)
To explain: The reason why free cash flow often provides better information than “Net cash provided by operating activities.”
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Managerial Accounting: Tools for Business Decision Making
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