Statement of cash flows
Write a 350-word response to the following: Why are companies required to prepare a statement of cash flows? Why is the statement of cash flows divided into three sections? What does each section tell you about the operations of a company?
Format your response consistent with APA guidelines.
A statement of cash flows can be build from an income statement and a balance sheet. The cash flow statement contains cash flow from operating activities, cash flow from investing activities and cash flow from financing activities are its main sections.
The first portion is the cash flow from operating activities. The first item is operating income from the income statement. This is the earnings…